Record profits for health insurers, fewer people insured, higher premiums

Posted by AzBlueMeanie:

This is what a year of obstruction from the Grand Obstructionist Party has wrought: record profits for health insurance companies and fewer people insured. And even higher insurance premiums on the way this year. This is the fleecing of America by health insurance companies, aided and abetted by Republicans in Congress and industry funded corporate Astroturf (FreedomWorks) Tea Party protestors. And don't think I have forgotten you Blue Dog Democrat corporatists.

As the nation struggled last year with rising health-care costs and a recession, the five largest health insurance companies racked up combined profits of $12.2 billion – up 56 percent over 2008, according to a new report. Big insurers of health see profit surge:

Based on company financial reports for 2009 filed with the Securities and Exchange Commission, the report said insurers WellPoint Inc., UnitedHealth Group, Cigna Corp., Aetna and Humana Inc. covered 2.7 million fewer people than they did the year before.

Thursday's report also said three of the five insurers cut the proportion of premiums they spent on their customers' medical care, committing relatively more to salaries, administrative expenses and profits.

Read the report by Health Care for America NOW here: http://hcfan.3cdn.net/a9ce29d3038ef8a1e1_dhm6b9q0l.pdf

Republicans voted in lockstep in support of American Health Insurance Plans (AHIP) and Pharma to undermine health care reforms last year, despite a record yearly increase in health care costs in 2009. Health care ate up a record 17.3% of US spending in '09, gov't says "This was the single largest one-year jump in health-care spending as a share of the nation's gross domestic product since the government started keeping such records a half-century ago." Without health care reforms, this will continue year after year.

In California, Anthem Blue Cross, a subsidiary of WellPoint, is facing growing scrutiny over its decision to raise premiums for individual health-insurance policies by as much as 39 percent this year for some consumers. Reform, Meet Anthem Blue Cross (Los Angeles Times):

The prospects for healthcare reform legislation in Washington are cloudy, but Anthem Blue Cross apparently isn't taking any chances. The company recently informed many of the approximately 800,000 Californians who buy its individual policies that premiums will rise sharply March 1. Although Anthem provided no details, insurance brokers say they're already seeing increases of up to 39%. That's on top of even larger rate hikeslast year. With the pending healthcare bills proposing new limits on premiums and profits, the Anthem increases look suspiciously like an attempt to extract as much as possible from customers before the rules change.

The response from state and federal regulators was swift and heartening. California Insurance Commissioner Steve Poizner, who can't regulate rates directly but can limit insurers' profit margins, announced that he was hiring an independent actuary to scrutinize the planned increase. The House Energy and Commerce Committee and Health and Human Services Secretary Kathleen Sebeliusalso launched inquiries. To truly protect consumers, though, Congress should pass a healthcare reform bill that makes it easier for people to switch insurers without sacrificing coverage.

* * *

[The bills before Congress] would bar insurance companies from cherry-picking customers and denying coverage for preexisting conditions, enabling people to switch insurers easily. The bills also would promote competition and clarity in pricing through a new marketplace for individual policies. Anthem's actions offer the best argument yet for Congress to complete work on a comprehensive bill without delay.

[T]he industry's improving financial fortunes are drawing more criticism because all but one of the companies achieved the better results at the same time they lost customers. Big insurers of health see profit surge:

WellPoint shed nearly 1.4 million customers, a 3.9 percent drop over 2008, its filings say. And Cigna lost 5.5 percent of its customers, or 639,000 people.

Only Aetna, which also was the only company whose profits decreased from 2008, gained new customers, picking up an additional 1.2 million people, an increase of 6.9 percent.

The shrinking customer base – which reflects increasing unemployment and the growing number of companies that are dropping coverage – was offset slightly by growth in the companies' public-sector business.

Many increased the number of people they insure through Medicare and Medicaid. [You know, that single payer "government run socialized medicine" system.] The government programs for the elderly and the poor increasingly rely on private health plans to administer benefits. [So much for that "socialism" nonsense.]

Industry analyst Sheryl Skolnick, a senior vice president at CRT Capital Group, said many of the insurance companies would likely benefit from more customers. But they are driven to increase prices for their products to satisfy investors, which in turn drives away more and more customers.

"It is a terrible thing to run your business for Wall Street," Skolnick said. "It creates very bad incentives, and it ultimately prevents you from doing the thing that is in the best long-term interest of your business. … There is no way that as long as these businesses are publicly traded, they can have the best interest of their customers at heart."

Well said, Mr. Skolnick. End the obstruction and pass health care reform with a public option now.