Under the Tax Cuts and Jobs Act, BCBS companies reported a total change of $4.7 billion in net deferred income tax for 2017. That’s compared to $854 million in net deferred income tax for 2016.
However, because of changes under the TCJA, several of the Blues plans also saw a negative change in the value of the deferred tax asset. This partially offset their change in net deferred income tax to the $2.3 billion total, according to A.M. Best’s briefing.
The benefits varied by plan, with Health Care Service Corp. recording a net effect of $1.1 billion for 2017 under the new tax code. BCBS of Michigan and Horizon Healthcare Services posted positive effects over $300 million, while several other plans saw positive gains totaling more than $100 million.
“The impact of tax reform, combined with an overall improvement in earnings, resulted in a favorable change to capital and surplus in 2017 of almost $8.8 billion for the aggregated Blues,” according to A.M. Best.
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