Blue Cross Insurer May Reduce Obamacare Rates In Five States

Blue Cross Blue Shield Tower, the headquarters of Health Care Service Corp. on July 09, 2014 in Chicago, Illinois. Health Care Service operates Blue Cross and Blue Shield plans in Illinois, Texas, Oklahoma, New Mexico and Montana. (Photo By Raymond Boyd/Getty Images)

One of the nation’s largest operators of Blue Cross and Blue Shield health insurance plans said it made more than $1 billion last year, which bodes well for purchasers of its individual coverage under the Affordable Care Act.

Health Care Service Corp. said it “earned $1.3 billion and grew membership by 315,000” on a range of policies it sells individuals, employers and small groups in five states. Health Care Service operates Blue Cross and Blue Shield plans in Illinois, Texas, Montana, Oklahoma and New Mexico.

The improving finances for Health Care Service, which in recent years had lost hundreds of millions of dollars on its individual business, now means some individual Obamacare customers in five states could see reduce rates . Health Care Service, which is a mutual insurer owned by policy holders, said it has “filed average rates for small group Affordable Care Act-aligned plans ranging from slight reductions to modest increases, effective July 1, 2018.” The insurer wouldn’t say which states would see lower rates.

“Final small group rates will be finalized in spring and may vary by customer,” Health Care Service said. “While individual rate filings have not been completed, preliminary analysis suggests relief for individual rates similar to what is filed for small group products, provided sensible market stabilization measures remain in place.”

As part of its announcement on improving profits of its Blue Cross plans, Health Care Service said it has “committed $1.5 billion over three years to accelerate its efforts to reduce health care costs for its members.” The effort includes investments to improve “collaborative care” relationships with medical providers and patients to improve health outcomes and invest more in digital and data technology.

“Over the last several years, we reduced our expenses, managed medical costs across the health care system and remained true to our commitment to stand with customers – even in tough market conditions when others wavered,” Health Care Service chief executive Paula Steiner said in a statement.

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Health Care Service is the latest insurer to signal improving profits for business it offers under the ACA. Cigna and Centene are also seeing improved profits from their individual businesses even after gaining customers from insurers like Aetna and UnitedHealth Group that left the ACA’s exchanges after they couldn’t effectively manage the costs of sick patients buying individual policies.

Source: Forbes