Highmark reports $1.1B profit for 2017, reverses ACA losses
Highmark Health group reported nearly $1.1 billion in net income in 2017, up from $59 million in 2016.
The gains in income came as revenue for the Pittsburgh-based health insurer remained stable, rising slightly from $18.23 billion in 2016 to $18.26 billion in 2017.
Calling 2017 "a watershed year" for Highmark, CFO Karen Hanlon attributed the higher profit to growth in the commercial and government sectors of its insurance market as well as a turnaround of its business related to the Affordable Care Act, which turned its first profit in 2017.
According to president Deborah Rice-Johnson, the changes in the ACA market are due to changes made by Highmark in its premiums for ACA plans and in the way it helps patients manage their care.
"It's around products, it's around product care management, and how we engage with the network, the provider, and Highmark," said Rice-Johnson.
Highmark executives also noted new partnerships Highmark had formed over the past year, including its collaboration with Penn State Health announced last December.
Highlighting the fact it will involve Penn State Health providers as well as the Penn State University College of Medicine, Highmark CEO Dave Holmberg noted the deal will include a new health network as well as new delivery and treatment models "designed to keep care local."
Since the deal was announced last December, the venture has thus far included the appointment of several Highmark executives to the boards of Penn State Health and the Penn State Health Milton S. Hershey Medical Center in Derry Township.
In February, Penn State Health announced the appointment of Highmark president Deborah Rice-Johnson, CFO Karen Hanlon and Chief Legal Officer Thomas VanKirk to the board of directors for Penn State Health. The move increased the size of the board from 10 members to 13.
The appointments came a week after Highmark Chief Medical Officer Tony Farah joined the board of the Hershey Medical Center, the flagship hospital of Penn State Health.
In its most recent numbers, Highmark Health reported 4.6 million members, including 3.9 million in Pennsylvania where the carrier has a 37 percent market share. A large portion are in Western Pennsylvania, where Highmark has 2.3 million members.