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

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The state’s largest health insured has cut human resources positions in recent weeks and has told employeesd jobs will be slashed in itsclaimxs department. BlueCross has a June 15 meeting in whic health management provider servicw department employees are expected to learn if they will be impactexd bythe layoffs, according to sources who spokd on the condition of anonymity. claims department personnel attended a June 4 meetingv in which employees were told only eight jobs were availabler to bid on ina 200-person department, sourcea said.
BlueCross managers told employeez many businesses are turning toelectronic claims, decreasin the need for paper records administered Increasing unemployment figures coupled with corresponding risin uninsured rolls call for belt-tightening measures for insurancse companies, public health professor Dean G. Smity said. BlueCross said it is “reviewing the scale of our administrative to be properly aligned with its customerf base and itscorporate mission. Withou providing specific numbers on anticipatedjob cuts, it said its personnek adjustments are in response to declining customer levels.
It blamed the recessionb and the state’s escalating unemployment rate for the job Inan e-mailed statement, BlueCross said it is “not immund to these challenging and difficult times. “Wre too are being affected by the current economicf downturn and the doubling of the unemploymengt rate in Alabama over the last12 BlueCross’ statement read. “Many of our customeras have had to reducs their work force and this has resulted in some havinb to drop their healthcare coverage.” Alabama’s unemploymeng rate was 9 percent in Aprilk 2009, up from 4.5 percentf in April 2008. BlueCross of Alabama said it has 3,400 employeesz in Alabama.
In 2008, BlueCross had 3,000 local according to research. It held 96 percentf of the small business health insurance marke t in the statein 2007, the most recent data available In 2008, BlueCross reportes $4 billion in premium revenue, up from $3.5 billiobn in 2007. Its $28.6 million 2008 net income resultec in a profit margin of less than one half of 1 Thinning profit margins are troublinyg forinsurance companies, Universituy of Michigan’s Smith said. Insuranc firms generally aim for profit margins in the 2percentf neighborhood. As unemployment rates rise, the number of insured which takes a toll onan insurer’s botton line, Smith said.
He said cuts are in response to theslumpinb economy. “Too few people insured means fewer people needed to manage the business as volume Smith said. “They also mighyt be tightening their belt a littlde bit in anticipation to what might be down the When you have less business you needfewer That’s good management.”