Pittsburgh-based Highmark Health posted an operating income of $440 million on revenues of $26 billion for fiscal year 2022, but investment slumps resulted in a net loss of $346 million for the year. Excluding investment losses, the company reported net earnings of about $47 million, according to financial results released March 20.
Six things to know:
1. Highmark attributed the strong operating performance to the results of its insurance business units — Highmark Health Plans, United Concordia Dental and HM Insurance Group — driven by increased membership, more affordable options and improved outcomes.
2. Highmark Health Plans posted an operating gain of more than $500 million in 2022 and grew its membership by 2.5 percent year over year.
3. Highmark's hospital business, Pittsburgh-based Allegheny Health Network — a 14-hospital system — reported a $181 million loss for 2022, up $61 million from 2021. Contract labor doubled in 2022 to $193.9 million and operating expenses increased 10 percent to $4.5 million. Operating margins dropped to -5.5 percent, compared to -1.9 percent in 2021.
4. Highmark Health's balance sheet ended 2022 with $11 billion in cash and investments and $9 billion in net assets, according to the report.
5. Highmark Health said it experienced headwinds from staffing challenges, equity portfolio performance and its supply chain in 2022, and expects some of those challenges to continue this year. "However, the diversity of our business model, our continued growth through partnerships and affiliations, and strong performance will allow us [to] deliver on our mission to create a remarkable health experience, freeing people to be their best," Janine Colinear, senior vice president of finance and interim CFO and treasurer of Highmark Health, said in the release.
6. Highmark owns Allegheny Health and Highmark Health Plans, which operates the Blue Cross Blue Shield affiliates in Delaware, West Virginia and parts of Pennsylvania and New York.