Excellus reports net income of nearly $100 million in 2016
Wednesday, March 1, 2017
Excellus BlueCross BlueShield, Central New York’s largest health insurer, reported net income of $99.5 million on $6 billion in premium revenue last year.
The figures were disclosed in an annual financial report that the Rochester–based health insurer filed Wednesday with the New York State Department of Financial Services.
Excellus’ net income rose more than 70 percent from the $58 million it reported in 2015.
Excellus attributed a $63 million reduction in administrative expenses to the improved net income.
“It’s critical for our plan to achieve a margin so that our business can be financially healthy for the security of our members,” Christopher Booth, CEO of Excellus, said in a news release.
Last year’s net income “aligns” with Excellus’s “stated goals” of earning on average 1.5 percent annual net income. The $99.5 million net-income figure represents 1.7 percent of the $6 billion in premium revenue generated during 2016, Excellus said.
Excellus in 2016 paid more than $5.1 billion in medical bills on behalf of its insured members. Payments for medicines represented “a big share.”
The health plan paid about $1.3 billion in drug benefits. Between 2015 and 2016, there was a 10.8 percent increase in drug spending per member among those who had prescription coverage.
Medical and other services related to cancer treatments ($323 million); joint disorders ($193 million); and preventive-care services ($185 million) represented the top three categories of claims payments, according to the health plan.
Excluding $104.7 million that Excellus paid the federal government as part of the Affordable Care Act’s health-insurer tax, medical-benefit payments comprised about 87 percent of premium revenue.
In total, the company paid $506 million in state and federal taxes.
Net income goes into the health plan’s reserves to protect its members from higher-than-expected claims expenses or lower-than-anticipated revenues, Excellus said.
Health-plan reserves amount to $1.2 billion, or $1,009 per insured member.
Excellus is the largest division of its parent company, The Lifetime Healthcare Companies, a multi-billion-dollar organization managing other businesses, including long-term care insurance, benefit services, home health care, health centers, and medical practices in upstate New York.
Collectively, the corporation employs nearly 5,500 people in multiple locations across upstate New York.