Harvard Pilgrim books $55M loss
Health insurer Harvard Pilgrim, which entered the Connecticut market two years ago, said it lost nearly $55 million in 2015 on higher pharmacy costs and payments required under the Affordable Care Act.
The Massachusetts insurer, which operates in four states, this month reported a fourth-quarter net loss of $39.7 million - its largest of 2015. In the fourth quarter of 2014, Harvard Pilgrim booked a profit of $6.5 million.
For the full year, the insurer reported higher premium revenue, which grew from $2.55 billion to $2.73 billion. But it also saw higher medical costs, which grew from $2.14 billion to $2.38 billion.
The company said it was required to make so-called “risk-adjustment payments” in three of its four states last year. The payments generally apply to insurers that have a less risky pool of customers.
Charley Goheen, chief financial officer, said in a March 1 statement that Harvard Pilgrim signed pay-for-performance agreements with the manufacturers of two high-cost drugs in 2015.
“Despite these wins, pharmacy costs continue to rise and impact cost trends across the board,” Goheen said.
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