Strong competitive position in its core Pennsylvania market. Very strong risk-based capitalization, based on Standard&Poor's Ratings Services' model. Ample liquidity, supported by operating cash flow and a high-quality investment portfolio. Favorable earnings diversification through its higher-margin specialty products business. Strong financial flexibility, with modest debt leverage. Marginally adequate earnings profile for an 'A' rated not-for-profit health insurer. Continued operating margin strains in key market segments. A slightly unfavorable regulatory environment. Status as "insurer of last resort" in western and central Pennsylvania. The insurer financial strength rating on Highmark Inc., which does business as Highmark Blue Cross Blue Shield and Highmark Blue Shield, is based on the company's strong competitive position in its core Pennsylvania market, very strong risk-based
