Insurers profit from health reform
After dropping almost $90 million to oppose the health reform law, repeatedly claiming its provisions would raise costs and disrupt coverage, health insurers actually have benefited the most from the law, according to a Bloomberg Government report released Thursday.
The average operating profit margins for the five largest insurers--Wellpoint, UnitedHealth, Aetna, Humana and Cigna--expanded to 8.24 percent in the six quarters since reform, compared to 6.88 percent for the 18 months before the reform law passed, reports Bloomberg.
"The industry that was the loudest, most persistent critic of this law, the industry whose analysts and executives predicted it would suffer immensely because of the law, has thrived," said Peter Gosselin, study author and senior healthcare analyst for Bloomberg Government.
These prosperous times are largely a result of insurers expanding into government programs, whose share of big insurers' revenues jumped from 36 to 42 percent in the past three years, The Washington Post reports.
The insurers stand to reap even more benefits as they position themselves to gain from Medicaid's expansion in 2014, when it covers at least 16 million additional individuals and the federal government subsidizes private insurance policies for an additional 19 million individuals. In fact, insurers can bid on roughly $40 billion in state Medicaid contracts in the next two years, Bloomberg notes.
To learn more:
- read the Bloomberg article
- see the Washington Post article
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