Fallon Health Reports Second-quarter Financial Results
WORCESTER ― Fallon Health reported a net loss of $2.5 million on revenue of $321 million on a GAAP basis for the second quarter that ended June 30, 2015. The net loss includes investment and other income of $2.5 million and an operating loss of $5.0 million. For the same quarter last year, Fallon posted net income of $2.3 million on revenue of $312 million. Net income included investment and other income of $3.2 million and an operating loss of $0.9 million. Membership was 221,588 as of June 30, 2015, compared with 227,930 ending June 30, 2014.
“Our results reflect the continuing challenges in the evolving health care environment. Health plans continue to absorb ever-increasing expenses related to high-cost specialty drugs as well as the rapidly rising costs of generic and brand-name prescription drugs,” said R. Scott Walker, executive vice president and chief financial officer at Fallon Health. “Heightened regulatory pressures from national and state reform, decreasing rate reimbursements for certain government programs, and the state’s risk adjustment model, mandated by the Affordable Care Act, also impact results.”
In addition, the second-quarter results reflect one-time costs associated with Fallon’s recent decision to exit the One Care demonstration program as of Sept. 30, 2015.
In the second quarter, Fallon continued to see growth in its subsidized product, Community Care, as more subsidy-eligible individuals enrolled though the Massachusetts Health Connector.
“Fallon is a strong, mission-focused organization with a dedicated, engaged, and resilient workforce,” said Walker. “We’ll continue building on our strengths, which includes providing members with cost-effective, high-quality products and services.”
Fallon consistently rates in the top 10% of all plans for its Medicare, Medicaid and commercial products by the National Committee for Quality Assurance.