The parent company of Blue Cross and Blue Shield of Minnesota posted a smaller operating profit once again last year, showing more evidence that above-average COVID-era earnings are over for health insurers.

For 2024, Aware Integrated, the parent company of Eagan-based Blue Cross, saw operating income of $27.6 million, down about 73% from the previous year due to what the company called historically high levels of health care utilization in 2024.

In regulatory filings this month, Blue Cross of Minnesota said operating profit increased from commercial/employer group coverage, but the gain was more than offset by losses in health plans for people with privatized Medicare and Medicaid.

The Medicare Advantage business was hit with higher claims costs, the company said, while its Medicaid HMO saw lower membership and greater service use among those enrollees who remained.

"The use of health care services last year was at historically high levels," Dana Erickson, the CEO of Blue Cross of Minnesota, said in a statement. "The impact of those costs was offset by multiple years of administrative and operational expense savings and an increase in overall membership."

With about 3,000 employees, Aware Integrated consists primarily of the Blue Cross health insurance business, although the parent company also has some smaller holdings, including a life insurance subsidiary and an online mental health program.

Blue Cross and Blue Shield of Minnesota, which includes an HMO called Blue Plus, is the state's largest nonprofit health insurer.

The Minnesota Star Tribune uses the term "profit" to describe earnings at the state's largest nonprofit groups to reflect the significant capacity of these large organizations to make money even as these funds are reinvested in nonprofit operations.

For-profit companies generally make at least some earnings available to outside investors.

In filings with regulators, Blue Cross of Minnesota warned that Medicaid, which provides coverage for lower-income state residents, could be cut significantly going forward due to changes being considered by the Trump administration and congressional Republicans.

"The new administration may propose transitioning Medicaid to block grants or per-capita funding models, which could lead to significant financial constraints for state Medicaid agencies, necessitating substantial program modifications," the company said in an April 1 filing for Blue Plus.

"Additionally, there may be a reinstatement of work requirements and stricter verification processes for Medicaid eligibility, impacting enrollment and access to care for beneficiaries," the company said.

To some extent, the red ink for Blue Cross last year on its Medicare Advantage and Medicaid health plans fits with results reported this month from Minneapolis-based UCare, which saw an unprecedented $504 million loss on operations in 2024.

Regulatory filings, however, suggest UCare and other health insurers in the state saw much larger Medicare Advantage losses on a per-subscriber basis than did Blue Cross.

In an April 3 news release, Aware Integrated reported $16.5 billion in revenue in 2024 across all its holdings, although the company includes "premium equivalents" in this figure.

The Star Tribune excludes premium equivalents from its annual tally of the state's largest nonprofit groups, since other health insurers don't report this revenue. Premium equivalents reflect the sums that self-insured groups pay themselves in employer health plans where Blue Cross of Minnesota is the third-party administrator.

In 2023, the health insurance business at Blue Cross posted revenue of about $8.3 billion on its own, making the insurer the state's third-largest nonprofit group, according to a Star Tribune calculation. Revenue at the health insurance business grew to about $8.8 billion in 2024.