Independence Blue Cross this week began a third wave of personnel cutbacks, with about 200 people expected to lose their jobs in the next several months.

This will bring to 855 the number of job losses at the Philadelphia insurer since June.

"As of October, we have an operating income and net loss, and we do not expect to make the annual operating margin goal," Joseph Frick, Independence Blue Cross chief executive officer, explained in an annual report distributed to employees yesterday.

"There are many factors contributing to the unfavorable performance, including higher-than-expected medical costs and a business environment that continues to have an adverse effect on our membership and revenue," Frick wrote.

The economy has forced cutbacks at many health insurers, including Aetna Inc., of Hartford, Conn., and Cigna Corp., of Philadelphia.

When companies lay off employees, they and their families ultimately lose their health insurance, and the insurers, in turn, lose business. That also has been the case in Philadelphia, Frick said.

Frick said Independence Blue Cross clients were also changing their plans in ways that bring in less revenue for the company.

These layoffs follow a round of 530 early retirements in late October and 125 layoffs in June. Since the start of the year, employment at the region's largest health insurer has declined by 700, not including the recent cuts.

Some of the recent layoffs were necessary because Independence Blue Cross dropped plans from its portfolio, including some Medicare Advantage plans, spokeswoman Elizabeth Williams said.

Williams also noted that because the 2009 operating margin goal was not met, associates and executives would not get bonuses.

Independence Blue Cross had a loss of $78.7 million in 2008, compared with net income of $170.9 million in 2007. Medical membership dropped to 3.3 million as of Sept. 30, compared with 3.4 million last December.