BCBSNC Posts Gains in Operating Income Through the Third Quarter.CHAPEL HILL, N.C., Nov. 4 /PRNewswire/ -- Blue Cross and Blue Shield of North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures
Area, 52,586 sq mi (136,198 sq km). Pop. (BCBSNC BCBSNC Bluecross Blueshield North Carolina ), the state's largest health insurer, posted gains in operating income Operating Income
The profit realized from a business' own operations.
This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. through the third quarter of $17.7 million. This gain represents a $28 million improvement over the same period last year, excluding investments in new technology and Year 2000 expenses.
"Our year-to-date results mark another important milestone for us," said Bob Greczyn, president and chief operating officer Chief Operating Officer (COO)
The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . "Revenue is strong, and we're firmly focused on managing costs."
Total revenue at the end of the third quarter increased to $1.5 billion, up from $1.4 billion in the same period in 1998. The company continues to experience growth in enrollment, reaching over 1.9 million members.
In 1999, through the third quarter, BCBSNC spent over $30 million on technology improvements, including new technology and Year 2000 expenses. Technology expenditures in 1999 continue to outpace out·pace
tr.v. out·paced, out·pac·ing, out·pac·es
To surpass or outdo (another), as in speed, growth, or performance.
[-pacing, 1998, which were $13 million for the same period. Technology expenses contributed to a net operating loss operating loss
The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $12.3 million through September 1999, a $10.7 million improvement over last year.
After investment income, the company posted net income of $15 million through the third quarter. Net income is down from the same period last year due to a 1998 gain from restructuring the company's investment portfolio. BCBSNC ended the third quarter with a net worth of $587.5 million.
Gross margins, which reflect the difference between premiums and medical expenses, also continued to improve in the third quarter, gaining $35 million over last year. Likewise, the medical expense ratio, which shows the percentage of premium dollars spent on health care costs, showed improvement, standing at 83 percent for the third quarter, compared to 86 percent for the same period in 1998.
"We continue to make significant improvement, and we're on track to make our 1999 targets," said Dan Glaser, chief financial officer. "We're pleased with our results, but we know we can't stop here. We must continue to look for innovative solutions for our customers."
"Next year, we'll bring online a new suite of products designed to give our customers more choice, greater flexibility, improved service and better overall value," added Greczyn.
BCBSNC is the state's largest health insurer, with 1.9 million members and a 66-year history of providing quality, affordable health care coverage for North Carolinians. BCBSNC has earned Commendable Accreditation from the National Committee for Quality Assurance (NCQA NCQA National Committee on Quality Assurance, see there ), an independent, not-for- profit organization dedicated to measuring the quality of America's health care.
Blue Cross and Blue Shield of North Carolina is an independent licensee of the Blue Cross and Blue Shield Association. BCBSNC can be accessed online at www.bcbsnc.com
BLUE CROSS AND BLUE SHIELD OF NORTH CAROLINA and SUBSIDIARIES
Consolidated Statement of Operations See Income statement.
For The Year-to-Date Periods Ended
September 30, 1999 and 1998 UNAUDITED
1. Advantageous; helpful: favorable winds.
2. Encouraging; propitious: a favorable diagnosis.
1999 % 1998 % (Unfavorable) Premium and Fees $1,460,116 100.0 $ 1,370,360 100.0 $89,756 Less: Amounts Attributable to Claims under Self-Funded Arrangements 256,179 17.5 242,356 17.7 13,823 1,203,937 82.5 1,128,004 82.3 75,933 Medical Expenses 967,818 66.3 926,565 67.6 (41,253) Gross Margin 236,119 16.2 201,439 14.7 34,680 Broker Commissions 33,447 2.3 28,372 2.1 (5,075) TRICARE 10,996 0.8 11,913 0.9 917 Base Operating Expenses 173,953 11.9 171,432 12.5 (2,521) Total Operating Expenses 218,396 15.0 211,717 15.5 (6,679) Operating Income (Loss) 17,723 1.2 (10,278) (0.8) 28,001 Enterprise System Development and Remediation: Blue Edge 13,431 0.9 5,808 0.4 (7,623) Year 2000 16,601 1.1 6,995 0.5 (9,606) 30,032 2.0 12,803 0.9 (17,229) Net Operating Income (Loss) (12,309) (0.8) (23,081) (1.7) 10,772 Investment Income 35,561 2.4 64,803 4.7 (29,242) Income (Loss) Bef. Income Taxes 23,252 1.6 41,722 3.0 (18,470) Income Tax Provision (Benefit) 8,188 0.6 14,585 1.1 6,397 Net Income (Loss) $15,064 1.0 $27,137 1.9 ($12,073) Membership Underwritten 686,261 757,925 (71,664) Non-Underwritten 1,217,178 1,056,695 160,483 Total Membership 1,903,439 1,814,620 88,819