Health insurer Highmark, Pittsburgh, reported a net loss of $83.4 million for 2002 and said its reserves fell by more than $200 million, or 12%, to $1.9 billion. Highmark and other Pennsylvania Blue Cross and Blue Shield plans have drawn criticism for building up high levels of reserves, and the state insurance department held a public hearing on the matter last fall. The loss of $83.4 million on $7.4 billion in revenue compares with net income of $131.6 million on $6.8 billion in revenue for 2001. Highmark blamed increased utilization, an unstable investment market and one-time events, such as a new 10-year contract with UPMC Health System that helped avert bankruptcy at St. Francis Health System and build a new children's hospital. In 2002, Highmark earned $55.1 million in investment income compared with $162.3 million in the prior year. The company's total assets of $4.8 billion include $2.5 billion in investments and $593 million in cash. -- by Cinda Becker
Highmark blames utilization, UPMC deal for loss
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