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Blue Cross profits rebound from recession

Posted March 1, 2011

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— Blue Cross Blue Shield of North Carolina, the state's largest insurer, made almost $168 million last year, according to figures released Tuesday, but officials say the company's profit margin remains below targeted levels.

Profits soared by 56 percent from the $107 million Blue Cross made in 2009, when the company was battered by slow membership growth and poor stock market performance amid the down economy. Blue Cross posted profits of $186 million and $209 million in 2008 and 2007, respectively.

Blue Cross reported $5.2 billion in revenue in 2010.

"Overall, the company’s performance was strong last year. While many insurers lost customers, Blue Cross and Blue Shield of North Carolina is holding its own," President and Chief Executive Brad Wilson said in a statement. "We’re taking steps to trim administrative costs, and we remain focused on meeting the health care needs of our customers every day as we begin to implement health reform.”

Premiums went up by an average of 5.37 percent last year, and Blue Cross said more than 86 percent of the revenue from premiums paid for medical claims, officials said. Much of the remainder went toward customer service and technology expenses, they said.

Blue Cross' 3.2 percent profit margin last year was up from 2.1 percent in 2009, but it remained below the company's target of 3.5 to 4.5 percent, officials said.

Three top executives at the insurer made more than $1 million in salary, bonus and other compensation last year, led by Wilson at almost $1.9 million. Executive Vice President Maureen O'Connor made almost $1.3 million, and Senior Vice President John Roos made $1 million.

Two years ago, six Blue Cross executives topped $1 million in annual earnings.

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  • superman Mar 2, 2011

    Do you expect them to operate at a loss and go out of business? Do you have any idea how expensive hospitals and doctors are? No matter what they did to increase their earnings the cost of health care went up as did everything else. So the increased cost of coverage was probably in line with the increased cost of the benefits. Health insurance is still a good "deal" if you dont think so you wouldnt still have coverage. You would cancel it and pay your own medical bills.

  • boylan99 Mar 2, 2011

    "There hasn't been a peep out of the Tea Party or the GOP even mentioning the higher profits during a severe recession." blackdog

    I'll play. I know the word profit is "evil" to some of you but it was only 3.2%...that is a very small profit margin. Basic business knowledge tells you that. But I realize their are those that want total gov't healthcare so any profit by insurance is bad.

  • kathleenmarsocci Mar 2, 2011

    This is very sad and disturbing. Deductibles are going up, premium payments are going up, and so are their profits. There is no reason in this country that my health insurance monthly payment should be higher than my mortgage. Doctors and hospitals are blamed for higher insurance rates, but don't forget the insurance companies.

  • jenforthewin Mar 2, 2011

    Ummm...why are some of you thinking BCBS is a non-profit? They're the biggest of the big. Don't be fooled by their words (or any other insurance companies' promises for that matter).

  • blackdog Mar 2, 2011

    There hasn't been a peep out of the Tea Party or the GOP even mentioning the higher profits during a severe recession.

  • boylan99 Mar 2, 2011

    "Profits are up because they raised their deductibles for everyone. Everyone is paying about 2000 dollars before BCBS even kicks in paying anything, and you still will have to pay a percentage at that point. There is very little chance that they will NOT make a profit in that situation." CAMRON28551

    This did not happen on my policy. The companies that provide the benefit decide what options the employees have. Could be higher deductibles, higher copays, etc.

  • camron28551 Mar 2, 2011

    Profits are up because they raised their deductibles for everyone. Everyone is paying about 2000 dollars before BCBS even kicks in paying anything, and you still will have to pay a percentage at that point. There is very little chance that they will NOT make a profit in that situation.

  • boylan99 Mar 2, 2011

    Wait until Obamacare kicks in and an 500,000-750,000 additional NC residents become BCBS customers. The profits will sore yet the Dem's will still blame the GOP.

  • ncguy Mar 2, 2011

    so when do my premiums go down?

    Non profit huh? we'll see

    doesn't matter BCBSNC is in bed with unc healthcare and run a monopoly in this state

  • Iconoclast Mar 2, 2011

    And this is a non-profit company? Wonder how much the for profit guys are raking in? Oh, I forgot, the Tea Baggers say the insurance companies are going broke being nice guys.