Independent Health cutting 59 jobs as health costs rise

Independent Health is eliminating 59 positions, or a little less than 4% of its workforce, as the health insurer moves to cut expenses at a time when it is losing money and facing higher medical costs.

Independent Health called the cuts “part of a broader effort to streamline operations, increase efficiency and remain strong in a rapidly changing health care environment.”

The job cuts, announced Tuesday, are spread among varying positions across the company, said Frank Sava, an Independent Health spokesman.

The cuts come after Independent Health reported that it had a net loss last year of $66 million on revenues of $2.5 billion.

Independent Health

Independent Health is cutting 59 positions.

“Like health plans nationwide, we are navigating unprecedented financial pressures,” the Amherst-based health insurer said.

“Rising prescription and specialty drug costs, increased use of health care services, and upcoming federal funding cuts to Medicaid and Medicare are placing extraordinary strain on the system,” Sava said in a statement. “These challenges are affecting insurers of every size, and many across the industry are making far deeper cuts than we are today.”

Sava said that more than 90 cents of every premium dollar is used to pay for member medical and prescription costs.

“We have a responsibility to continuously look for ways to reduce administrative costs while maintaining quality and affordability,” he said. “That review led us to identify positions in various areas of the company that could be consolidated or restructured.”

Independent Health had about 1,200 employees before the job cuts, which take effect immediately.

The cuts affect a variety of departments at the insurer, including IT, claims processing and marketing, but were not concentrated in any specific area, Sava said.

The cuts will be “invisible” to Independent Health members, in terms of the services they receive, and will not affect the insurer’s community presence, Sava said. “We are grateful to all our associates for their contributions and are providing severance packages and outplacement support to those affected to help ease the transition.”

Because of rising costs, Independent Health in June requested double-digit increases in rates for people who buy individual commercial health insurance and small employers with 100 or fewer full-time workers.

Independent Health is seeking an average rate increase of 38.4% in the individual market, where it has roughly 7,300 members. On the small groups, in which Independent Health lists about 44,200 members, the insurer requested an increase of 19%.

Other health insurers are facing financial pressures similar to Independent Health’s. Highmark Western and Northeastern New York reported a net loss of $140 million on revenue of $3 billion in 2024.

Excellus Health Plan, which includes Univera Healthcare, posted a profit of $25.6 million due to strong investment results that offset a $163 million operating loss.

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