A.M. Best Affirms 'A-' -Excellent- Rating of Blue Cross Blue Shield of Kansas.OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 6, 1999--A.M. Best Co. today affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the "A-" (Excellent) rating of Blue Cross & Blue Shield Blue Shield A US not-for-profit health care insurer that is a reimbursement intermediary for physicians. Cf Blue Cross. of Kansas, Topeka, Kan. The rating reflects the company's dominant share of the Kansas health-care market, strong capital position and strategic focus on managed care. Offsetting these strengths are the company's continued underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. losses and the increased competition in the state. The company holds a 35% market share in Kansas and has an excellent understanding of the local market. The company has the largest indemnity Recompense for loss, damage, or injuries; restitution or reimbursement. An indemnity contract arises when one individual takes on the obligation to pay for any loss or damage that has been or might be incurred by another individual. enrollment in the state, while it continues to place significant emphasis on its managed-care product lines. The company's managed-care portfolio consists of Premier Blue (HMO HMO health maintenance organization. HMO n. A corporation that is financed by insurance premiums and has member physicians and professional staff who provide curative and preventive medicine within certain financial, ), Blue Select (POS (1) See point of sale and packet over SONET. (2) "Parent over shoulder." See digispeak. POS - point of sale ) and Choice Care product lines. Managed-care enrollment includes 208,000 members, approximately 42% of the company's total health-care enrollment. Blue Cross & Blue Shield of Kansas holds the Medicare Part A and Part B contracts for Kansas, as well as Medicare Part B for Nebraska and western Missouri. The company also was awarded a seven-year contract for the Kansas Medicaid Program. Strong investment returns have allowed the company to enjoy solid earnings for 1998, despite a negative trend in the underwriting cycle. However, A.M. Best remains concerned about the high equity exposure in its investment portfolio and reliance on capital gains to grow its capital position. Nevertheless, A.M. Best expects that the financial impact of any future downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. in the equity market would be mitigated mit·i·gate v. mit·i·gat·ed, mit·i·gat·ing, mit·i·gates v.tr. To moderate (a quality or condition) in force or intensity; alleviate. See Synonyms at relieve. v.intr. To become milder. by the company's strong capital level. Blue Cross & Blue Shield of Kansas will continue to have difficulty improving its operating performance. As more national managed-care companies enter its service area, competition may force the company into a more aggressive pricing position, which will continue to exert pressure on earnings. However, the company expects to have a greater percentage of its business delivered under some form of managed care, which should aid in the reduction of total medical costs. In addition, A.M. Best upgraded Advance Insurance Co., to "A-" (Excellent) from "B++" (Very Good). The rating reflects the company's steady growth in market share, operations, and earnings over the past five years, as well as its role as a strategic subsidiary of Blue Cross & Blue Shield of Kansas. A.M. Best Co. established in 1899, is Americas oldest and most widely recognized insurance rating and information source. For more information, visit A.M. Bests Web site at http://www.ambest.com. |
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