Blue Shield of California to take 4-day hiatus to save $4M

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Due to losses it shouldered under California's Affordable Care Act exchange, Blue Shield of California will close its doors for the four days following Labor Day to trim its payroll expenditures, the San Francisco Business Times reported. 

The San Francisco-based insurer's closure could save an estimated $4 million by cutting its liabilities for paid time off. The majority of its 6,000 employees will be affected, save for 1,000 who work for its subsidiary, Los Angeles County-based Care1st, and some staffers who work in open enrollment, information technology and medical services. The precise number of affected workers has not been determined.

Blue Shield will require staff to use paid time off from Sept. 6 through 9, according to the report. In doing so, the insurer will decrease the amount of paid time off liability hanging over its head later in the year.

"This is certainly not normal for us," spokesperson Steve Shivinsky told the San Francisco Business Times. "We're definitely seeing some income challenges as of mid-year," citing individual market claims exceeding revenue.

Blue Shield said while other insurers are exiting or cutting back participation on ACA exchanges, the insurer is not taking these steps. However, the insurer announced last month it will raise rates on its Covered California plans by 19 percent because of high enrollee costs and underpriced premiums. 

More articles about payer issues:
HHS says ACA individual risk pool is improving: 4 findings
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Aetna to give employees up to $10k for student loans

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