Fidelis Care New York, the church-sponsored insurance plan with a large operation in Getzville employing over 1,000 people, earned $215 million in net income last year, a drop of 19 percent from the year before as a sharp rise in premium revenue was matched and exceeded by soaring medical costs.
Known as a provider of government-sponsored insurance, Fidelis Care saw premium revenue rise 22 percent, to $6.7 billion, between 2014 and 2015, as membership rose 16 percent, to 1.3 million across the state.
However, the cost of providing services to the company’s members rose even more, by 23 percent, to $6.1 billion. And that, coupled with increased administration costs, and non-operating losses, led to the decline in net income, according to a summarized statement of operations from the company’s filing with the state Health Department.
Fidelis Care is structured differently than the other insurance companies that call the region home. HealthNow New York, the Buffalo-based parent of BlueCross BlueShield of Western New York; Amherst-based Independent Health; and Excellus BlueCross BlueShield, the Rochester-based parent of Univera Healthcare of Amherst; all sell commercial coverage to large- and small-group employers and file their annual financial statements to the state Department of Financial Services.
However, Fidelis Care does not offer commercial coverage to large companies or small businesses. Managed Medicaid, Medicare Advantage, Child Health Plus and coverage sold through the state’s health insurance marketplace make up nearly all of its business.
Fidelis Care saw premium revenue rise for all four of those categories between 2014 and 2015. However, medical and administration costs rose by a greater amount in three of the four lines, and the company suffered losses or saw revenue decline in non-operating sectors.
That’s why net income fell 27 percent, to $234 million, for managed Medicaid, which makes up the bulk of Fidelis Care’s business; losses fell 114 percent for Child Health Plus, to a loss of $14.1 million; and losses fell 188 percent, to a net loss of $57.5 million, for Medicare Advantage.
The bright spot was on the health insurance exchange, where Fidelis Care offers individual coverage, and where membership rose 83 percent, to 84,663 members, in 2015. Net income rose 56 percent, to $13 million, for its exchange line of business.
As of March, Fidelis Care employed 1,100 workers at its expanding offices on CrossPoint Parkway in Getzville.
Fidelis Care outperformed the other insurers with significant local operations in 2015. HealthNow reported $63 million in net income, Univera’s parent reported net income of $58 million and Independent Health reported a net loss of $44 million.