Blue Shield of California reported a net income of $115 million in 2015, down from $162 million in 2014. Of the company's 2015 revenue from premiums, 83.4% was spent on medical expenses.
In 2015, the company contributed $35 million to Blue Shield of California Foundation and has given more than $360 million over the last 10 years.
Our 2% Pledge: Four years ago, Blue Shield became the first health plan in the nation to voluntarily limit net income to 2% of revenue. Any year in which Blue Shield earns more than 2%, the company will return the difference to its customers and the community, with approval by the board of directors. Since 2011, the company has returned $560 million to customers and the community. Blue Shield’s profit margin was below 2% in 2014 and 2015 and, as a result, we did not return any funds as part of our pledge commitment.
For information about Blue Shield’s 2015 executive compensation, click here.
Blue Shield of California Consolidated Financials*
*Additional details on Blue Shield’s financial performance can be found on the California Department of Managed Health Care website by searching for “California Physicians’ Service.”
**2014 medical loss ratio reflects the impact of Affordable Care Act (ACA) taxes on premiums; we estimate this to account for a reduction of 2 percentage points from that reported above.
***Increase in 2014 income tax expense reflects improved operational performance, the non-deductibility of a new ACA tax and a protested assessment from the California Franchise Tax Board.