News Column

IBC reports 25 percent drop in profits

June 10, 2014

By Harold Brubaker, The Philadelphia Inquirer

June 10--Independence Blue Cross' profits tumbled last year to their lowest level since the region's largest health insurer lost money in 2008 and 2009, according to IBC's annual report on its web site.

The Center City company reported net income of $142.6 million in 2013, down by a quarter from $191.5 million in 2012, despite a 5 percent increase in revenue, the annual report's barebones financial statement said.

Total revenue was $11.05 billion, up from $10.48 billion, the company said.

"Amid dramatic changes in health care, we are pleased to report a year of financial stability," M. Walter D'Alessio, chairman of IBC's board of directors, and Daniel J. Hilferty, the company's chief executive, said in a commentary at the beginning of the annual report.

In May 2013, IBC held a teleconference for reporters and issued a news release for its 2012 financial results. This year the report was posted on the web site with no fanfare.

On a positive note for IBC, the rate of decline in the number of employer groups it insures fell dramatically. The number of employer-based groups served by IBC fell to 34,498 last year, down less than 1 percent from 34,670 in 2012.

In six of the previous seven years, the number of employers obtaining insurance for employees through IBC had fallen by at least 5 percent.

IBC said it employed 8,568, up from 7,472 at the end of 2012. AmeriHealth Caritas, which manages government-funded health insurance programs and has operations in 16 states, accounts for about 4,000 of those employees.

The company said it added $228 million to its surplus, or rainy-day fund, bringing it to to $2.73 billion.

While IBC's highest-level holding company is tax exempt, most of its es pay federal, state, and local taxes, not including payroll taxes for the benefit of its employees taxes. In 2013, those taxes totaled $268 million, up from $250 million in 2012.




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Source: Philadelphia Inquirer (PA)

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