DURHAM, N.C. – Reduced customer premiums and record-high medical expenses resulted in lower net income for Blue Cross and Blue Shield of North Carolina (Blue Cross NC) in 2019. Membership grew to 3.81 million, up from 3.72 million in 2018.

A key driver of Blue Cross NC’s 2019 performance was the Affordable Care Act (ACA) line of business, despite uncertainty and debate around health care in Washington.

“In 2019, Blue Cross NC enrolled more customers, lowered customer premiums and remained financially stable in a volatile environment,” said Mitch Perry, chief financial officer for Blue Cross NC. “At the same time, we’ve made significant progress on our commitment to better, simpler, and more affordable health care.”

Financial Results*




$9.9 billion

$9.9 billion

Net Income Ratio

5.0 percent**

6.9 percent

Net Income

$492.0 million**

$684.6 million

Taxes (Federal, State, Local)

$431.3 million

$670.0 million

Claims and Medical Expenses (Insured)

$7.3 billion

$6.8 billion

Months in Reserve

5.2 months in reserve

4.8 months in reserve

Membership (including Blue Card®)

3.81 million

3.72 million


*Financial results, excluding months in reserve, are GAAP results.

**In accordance with new GAAP guidelines. Under previous guidelines, Net Income Ratio for 2019 would be reported as 4.1 percent.Net Income would be reported as $387.6 million.

Medical Expenses Climb as Membership Increases

Blue Cross NC membership increased from 3.72 million in 2018 to 3.81 million last year, including customers served on behalf of other Blue Cross plans. The gain in membership came despite new competition in the Affordable Care Act market in North Carolina in 2019.

With the larger customer base and continued price increases for medical tests, procedures and treatments, Blue Cross NC saw record claims and medical expenses of $7.3 billion, up from $6.8 billion in 2018. Annual claims per person climbed to an average of $5,600 per fully insured member. Some of the services driving these higher medical costs include injectable drugs and infusions, specialty drugs, and treatments for chronic conditions such as hemophilia and anemia.

Financial Strength

State law requires the company to maintain reserves equal to a minimum of three months and maximum of six months of claims and administrative expenses in order to ensure financial stability for its customers. Blue Cross NC finished the year with reserves of 5.2 months.

“Our members’ health care needs can arise from unexpected circumstances,” said Perry. “Events like the Coronavirus provide an unfortunate example of external factors that can impact both health care costs and financial markets. Remaining financially strong and well capitalized allows our company to be prepared to meet the health care needs of our members, whatever they may be.”

Blue Cross NC continues to monitor developments related to the Coronavirus and will work with the Centers for Disease Control and Prevention and Blue Cross NC members to protect the health and well-being of North Carolina.

Blue Cross NC has published information related to the Coronavirus at bluecrossnc.com/coronavirus and will continue to provide updates as events warrant.

Savings for Customers, Investments in Health System Transformation

Due to strong financial performance and the launch of Blue Premier, the company’s value-based payment plan with providers, Blue Cross NC customers across the state in the individual market saw premiums lowered by an average of 5.5 percent for 2020. This marked the second consecutive year of price reductions in the individual market and the first statewide rate cut by the company.   

Blue Cross NC also lowered 2020 Medicare Advantage premiums by an average of 31 percent, with $0 premium plans available to all members.  

Rates for 2021 individual, under-65 plans will be submitted and reviewed in the spring.

“As a not-for-profit, Blue Cross NC does not have shareholders and our strong financial performance allows us to invest earnings directly toward lowering our customers’ out-of-pocket costs and improving services,” Perry said. “Making health care more affordable and accessible are focal points for our company. We’re pleased with our progress, but we know there is much more work to do.”  

Blue Cross NC expects to issue ACA-related rebates to Student group members in the fall of 2020. Calculations are still being finalized to factor in all claims from 2019 and impacted Student group members will be notified directly. Medical Loss Ratio rebate requirements ensure the vast majority of every premium dollar is used towards medical costs.

In 2019, Blue Cross NC signed seven of the state’s largest health systems to Blue Premier, which fundamentally changes how the company pays for care through a rapid and comprehensive move to value-based payments. In 2020, we expect half of the company’s attributed members to be in the care of providers in Blue Premier’s value-based contracts. The company is allocating more resources toward better, simpler, more affordable health care in North Carolina:


About Blue Cross NC:
Blue Cross and Blue Shield of North Carolina (Blue Cross NC) is committed to making health care better, simpler and more affordable since 1933. We have been driving better health in North Carolina for generations, working to tackle our communities’ greatest health challenges. We serve our customers and communities of more than 3.8 million members, including approximately 1.1 million served on behalf of other Blue Plans. Blue Cross NC is an independent licensee of the Blue Cross and Blue Shield Association. Visit Blue Cross NC online at www.bluecrossnc.com. All other marks are the property of their respective owners.