Highmark Health Pulls In More Than One Billion Surplus Dollars In 2017
Highmark Health announced Monday it recorded a $1.1 billion surplus in 2017, crediting the strong performance to increased investment in communities.
Highmark President and CEO David Holmberg said the positive financial report is encouraging the conglomerate to kickstart work on four proposed microhospitals in the Pittsburgh area. The hospitals will be part of Highmark's Allegheny Health Network.
"What we're seeing is that value-based strategy, the community focus, the investments we're making are working," Holmberg said.
The first microhospital will be in Westmoreland County, and is expected to have primary care, an emergency department and on-site specialties customized to the community's needs. The 20-bed unit is projected to open in 2019.
In October, Highmark announced it will spent $1 billion to expand the Allegheny Health Network, seen by some as an effort to compete with the University of Pittsburgh Medical Center. AHN has about 17,000 employees, compared to UPMC's more than 80,000.
Highmark Health announced last April that it had operating losses of $565 million in 2016, nearly all of it because of massive losses by its health plans marketed under the Affordable Care Act. Allegheny Health Network lost $36 million last year and Highmark's ACA marketplace plans lost $655 million, though other sectors of the company were profitable.
In 2017, Highmark's ACA business generated income for the first time.
The Associated Press contributed to this report.