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Capital Blue Defends Reserves

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NU Online News Service, Jan. 14, 2004, 1:23 p.m. EST – Capital Blue Cross, Harrisburg, Pa., says it cut its reserves by $100 million in 2003 in an effort to hold down customers’ premium increases.[@@]

Pennsylvania officials have argued that nonprofit health insurers in the state are building excessive reserves by charging rates that are too high, but Capital Blue President James Mead has issued a statement arguing that his company needs its remaining reserves so that it can pay all claims even in the event of a catastrophe.