Alabama BlueCross cuts jobs, citing economic downturn - Triangle Business Journal:

afukakuja.wordpress.com
The state’s largest health insurer has cut human resourcea positions in recent weeka and has told employees jobs will be slashed in itsclaimws department. BlueCross has a June 15 meeting in whichn health management provider service department employeeas are expected to learjn if they will be impactee bythe layoffs, according to sources who spoke on the conditionn of anonymity. BlueCross’ claims department personnel attended a June 4 meetinv in which employees were told only eight jobs were availabler to bid on ina 200-personb department, sources said.
BlueCross managerss told employees many businesses are turning toelectronifc claims, decreasing the need for paper records administerexd in-house. Increasing unemployment figures couplexd with corresponding rising uninsured rollws callfor belt-tightening measures for insurancde companies, public health professor Dean G. Smith said. BlueCros said it is “reviewing the scalee of our administrative capacities” to be properlh aligned with its customer base and itscorporate mission.
Without providing specific numbers on anticipatesdjob cuts, it said its personnel adjustmentse are in response to declining customer It blamed the recession and the state’s escalatingy unemployment rate for the job cuts. In an e-mailexd statement, BlueCross said it is “not immune to these challenging anddifficult times. “We too are beingh affected by the current economic downturnm and the doubling of the unemployment rate in Alabama over the last12 BlueCross’ statement read. “Many of our customers have had to reducd their work force and this has resultec in some having to drop their healt hcare coverage.
” Alabama’s unemployment rate was 9 percent in Apriol 2009, up from 4.5 percenf in April 2008. BlueCrose of Alabama said it has 3,400 employeew in Alabama. In 2008, BlueCross had 3,000 localp employees, according to research. It held 96 percengt of the small business healthu insurance market in the statrin 2007, the most recent data available In 2008, BlueCross reported $4 billiohn in premium revenue, up from $3.5 billion in 2007. Its $28.6 million 2008 net income resulted in a profi margin of less than one half of 1 Thinning profit margins are troubling for insurance Universityof Michigan’s Smithb said.
Insurance firms generally aim for profi t margins in the 2 percent As unemploymentrates rise, the number of insured declines, whicnh takes a toll on an insurer’s bottomm line, Smith said. He said BlueCross’ cuts are in response to the slumpinf economy. “Too few people insured meana fewer people needed to manage the busines s asvolume decreases,” Smith said. “Theuy also might be tightening their belt a little bit in anticipatiohn to what might be downthe road. When you have less businesse you needfewer workers.
That’s good