Blue Cross and Blue Shield of Minnesota Reports Business Results for 2009

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Blue Cross and Blue Shield of Minnesota

Apr 19, 2010, 05:35 ET

EAGAN, Minn., April 19 /PRNewswire/ -- Blue Cross and Blue Shield of Minnesota and its family of companies (Blue Cross) today released its business results for 2009. The organization reported a net operating income of just over one-half of one percent (0.57%) at $52.1 million on full-year revenues of $9.1 billion. Investment income, which declined in 2008 along with the overall investment market, had a more positive return in 2009. Overall net income (operating income plus other income, including investment income) was $132 million, reflecting the ongoing recovery of financial markets.

Blue Cross paid out $8.1 billion in claims on behalf of its members in 2009, which translates to 90.6 cents of every premium dollar collected going to health care costs. Administrative expenses represented 8.6% of premiums. Additionally, Blue Cross paid more than $79 million in taxes, assessments and surcharges. Overall enrollment remained virtually flat from the previous year at 2.8 million members, a trend driven in part by the slowed economy, workforce reductions and consolidations among employer clients.

"Blue Cross took several steps to achieve a positive operating return, which is very important to our overall stability," said Patrick Geraghty, president and CEO of Blue Cross and Blue Shield of Minnesota. "We work hard to make health care more efficient and effective for our members. Over the last year, the challenging business climate had a direct impact on enrollment, with significant layoffs among our member and client base. So in order to ensure our own administrative expenses were in line with membership trends, we undertook some difficult steps, including making staff reductions and freezing merit increases. Even so, we kept our highest priority on programs and systems that helped members and focused on member health."

"Our modest margin operating income for 2009 was in line with how a financially stable, efficient and responsible nonprofit health company should perform," said Geraghty. "Ending the year with positive results allowed us to reinvest in our Foundation and strengthen the work we do in communities throughout Minnesota. It also gives us the opportunity to make critical infrastructure investments, including improved IT systems and capabilities, which will allow us to deliver an even better member experience in the years ahead."

A consolidated earnings statement for 2009 results will be published on bluecrossmn.com.

In addition to these financial results, Blue Cross undertook several initiatives in 2009, including:

Revamping and expanding the line of individual health plans to 38 different choices – making it the largest array of individual options available in Minnesota. The company also launched a new product for individuals eligible for Medicare, called Platinum Blue(SM)
Becoming the first health plan in the continental U.S. to offer Online Care Anywhere, an innovative service that allows patients to access real-time, one-on-one medical services by logging onto a computer or using the phone at home or work
Investing more than $6 million in Minnesota communities through the Blue Cross and Blue Shield of Minnesota Foundation and Prevention Minnesota
Being named the sole Twin Cities business to receive the national Jefferson Award for community service and philanthropy
Implementing cost-saving pharmacy programs for clients that emphasize the utilization of safe, effective and approved generic drugs
Developing a three-year goal to reduce obesity levels and tobacco use among members

Blue Cross and Blue Shield of Minnesota, with headquarters in the St. Paul suburb of Eagan, was chartered in 1933 as Minnesota's first health plan and continues to carry out its charter mission today as a health company: to promote a wider, more economical and timely availability of health services for the people of Minnesota. Blue Cross is a not-for-profit, taxable organization. Blue Cross and Blue Shield of Minnesota is an independent licensee of the Blue Cross and Blue Shield Association, headquartered in Chicago. Go to bluecrossmn.com to learn more about Blue Cross and Blue Shield of Minnesota.

SOURCE Blue Cross and Blue Shield of Minnesota