Offsetting these positive rating factors is VBIC’s unfavorable membership trends, which has negatively impacted premium levels over the past several years and has continued through the second quarter of 2012. However, management expects membership and premium growth in the second half of 2012 due to the company’s ongoing strategic growth initiatives, with a focus on sustainable and profitable growth trends going forward.A.M. Best believes that VBIC is well positioned at its current rating level. However, key rating factors that could lead to negative rating actions include unprofitable membership growth leading to deterioration in the company’s operating performance, a decline in its absolute and/or risk-adjusted capital levels without any support from its parent, or adverse changes to VHS’ financial condition. The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Key criteria utilized include: “Understanding BCAR for Life/Health Insurers”; “Evaluating Non-Insurance Ultimate Parents”; “Rating Members of Insurance Groups”; and “Risk Management and the Rating Process for Insurance Companies.” Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.