Dive Brief:
- The majority of health insurers in Massachusetts are in a better position than last year, they report.
- Despite that, many are still struggling to operate in the black, reports the Boston Business Journal.
- Insurers attribute their negative operating margins to extreme regulatory pressure, low reimbursements from the state, taxes and fees associated with health reform, high-cost new drugs, and expensive IT upgrades.
Dive Insight:
Among major Massachusetts insurers, those reporting operating losses in recent quarters include Blue Cross Blue Shield, Fallon Health, Harvard Pilgrim Health Care and Tufts Health Plan.
“Our results are driven by several factors including the cost of complying with the ACA, competitive pressures on premiums, our continued investment in new technologies and services for our customers, and the rising costs of so-called specialty medications,” Allen Maltz, chief financial officer at Blue Cross Blue Shield of Massachusetts, told the Boston Business Journal. The insurer reported a $51.8 million operating loss during the second quarter of fiscal 2015.
On the flip side, BMC HealthNet Plan and Neighborhood Health Plan reported growth in operating income compared to the same periods in 2014.