Highmark's net income in 2009 nearly doubled, increasing from $94.1 million in 2008 to $187.7 million, and reflecting strong growth in its dental and vision subsidiaries and improved investment income.
Total revenues for 2009 rose to $13.7 billion, up from $13 billion in 2008. The company's net income represented 1.4% of operating revenues, compared with 0.7% in 2008, according to the company.
Strong revenue in 2009 from its dental, vision, and reinsurance businesses, which had a combined net income of $122 million, continue to support Highmark's core healthcare business.
The vision and dental subsidiaries represented more than half of Highmark's 2009 operating income and have greatly contributed to the company's financial stability, according to company spokesman Michael Weinstein.
The dental subsidiary, United Concordia, now has more than 8 million members and continues to grow its business in several federal government and state government dental programs, Highmark said.
The Pittsburgh-based Highmark's Blue Cross Blue Shield plans cover 29 counties of western Pennsylvania and its Blue Shield plans cover 21 counties of central Pennsylvania and the Lehigh Valley region of the state.
Citing job losses in Pennsylvania and across the U.S., Highmark said healthcare membership, including members in affiliated company plans, dropped to about 4.7 million from 4.8 million at year-end 2008.
The gains in investment income were due to improved equity markets in 2009, combined with much lower impairments on some assets in the company's investment portfolio that hurt its financial results in 2008, Highmark said.
In March, Highmark sued the Pennsylvania Insurance Department, saying the regulator's review of competition in the insurance market and the licensing agreements of the state's Blue Cross and Blue Shield plans was "unlawful and unauthorized," according to a story in the Pittsburgh Business Times.
The company said it is concerned with the release of information it believes is confidential.
In January 2009, Highmark and the Philadelphia-based Independence Blue Cross withdrew their applications to the insurance department to merge. A combined Highmark-Independence would have created the biggest health insurer in Pennsylvania.
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