The not-for-profit BlueCross BlueShield of Tennessee boosted its net income in 2013 by 15 percent to a record high of $256 million. The income helped swell BlueCross total reserves at the end of 2013 to $2.3 billion, including $1.8 billion immediately available for paying claims — more than 36 percent above the state-required minimum.
BlueCross officials say the extra income and reserves last year helped position the Chattanooga-based insurer for this year’s challenging expansions under the new health care reform law.
“As a not-for-profit company, we’ve built up our reserves over 79 years to give us the capital for new initiatives and expansions to serve the market and to make sure we can weather unforeseen problems,” BlueCross Vice President Roy Vaughn said.
BlueCross made money on both its commercial and government programs last year. BlueCross’s subsidiary which handles the Tenn-Care program, Volunteer State Health Plan, earned $41.7 million, reversing losses the company had from its TennCare operations in previous years.
Five years ago in 2009, Volunteer State Health Plan reported a $95.6 million loss before the state revised the program and BlueCross restructured its operations to limit some of its costs.
BlueCross, which already insures 3.1 million Tennesseans, will pick up even more customers this year as the dominant player among the new health care exchanges offered in Tennessee. But the company’s profits could be trimmed this year by higher taxes and lower margins on some operations as the new Affordable Care Act is implemented.
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