Health insurers watch profits soar as they dump small business customers
Several million previously uninsured Americans now have coverage because of Obamacare, but it could be argued that the people who have benefited most from the law—at least financially—are the top executives and shareholders of the country’s health insurance companies.
Among those who apparently have not yet benefited much at all, at least so far, are owners of small businesses who would like to keep offering coverage to their employees but can no longer afford it. They can’t afford it because insurers keep jacking their rates up so high every year that more and more of them are dropping employee health benefits altogether.
And let’s be clear, these insurers aren’t suffering. UnitedHealth Group, the largest health insurer, reported last week that it made $10.3 billion in profits in 2014 on revenues of $130.5 billion. Both profits and revenues grew seven percent from 2013.
United impressed Wall Street so much that investors pushed its share price to an all-time high. When the New York Stock Exchange closed last Thursday, United’s share price stood at $113.85, a record.
To put that in perspective, United’s share price was $30.40 on March 23, 2010, the day President Obama signed the Affordable Care Act into law. Since then, the company’s price per share has increased an astonishing 375 percent. That’s way more than either the Dow Jones or Standard & Poors averages has grown during the same period.
United is always the first of the big six health insurers to report earnings each quarter. When investors like what they hear from United’s executives, they typically go shopping for shares in the other five as well, believing that they, too, will soon report impressive results.
That certainly happened last week. Every one of the big six saw their shares reach or come close to reaching historic highs. Although they haven’t done quite as well as United, the other five have seen the price of their stock more than double or triple. Health Net’s share price has increased 224 percent since March 2010. Anthem’s is up 238 percent over the same time period. Aetna’s 290 percent. Cigna’s 305 percent. And Humana’s 309 percent.
Meanwhile, the number of Americans enrolled in health plans offered by small employers continued the steady decline that started years before Obamacare went into effect.
There’s more to this story. Click here to read the rest at the Center for Public Integrity.
This story is part of Wendell Potter. Former CIGNA executive-turned-whistleblower Wendell Potter writes about the health care industry and the ongoing battle for health reform. Click here to read more stories in this blog.
Related stories
OPINION: insurance tricks to avoid ObamaCare's consumer protections
Keeping an eye on insurance companies that refuse to pay claims
ANALYSIS: Opaque transparency from the health insurance industry
ANALYSIS: Insurance exchanges tilted toward health insurers, not consumers
Copyright 2014 The Center for Public Integrity. This story was published by The Center for Public Integrity, a nonprofit, nonpartisan investigative news organization in Washington, D.C.
