No. Premium rates are, and always have been, driven by what we expect to spend on our members’ medical care. In fact, the medical-loss ratio provision of the reform law explicitly restricts the proportion of premiums we can spend on administrative costs, including salaries and profits.
We are a taxpaying not-for-profit company, meaning we are not owned by investors or traded on the stock market. That means we have a unique ability to earn smaller profits – we target 1 percent to 4 percent each year – than other companies, but it’s impossible for any business to survive without earning some profit.
Our goal is to continue to remain financially strong, so that our members can trust we’ll be there for them when they need us. The profits we do earn each year are placed into our reserves, which are important because we don’t have access to capital markets and cannot raise funds on an as-needed basis. Learn more about how our financial strength ensures your peace of mind.
Posted in: Health Care Costs 101