http://www.epi.org/analysis_and_opinion/entry/health_insurance_providers_find_ways_to_prosper_as_more_people_lose_coverag/UnitedHealth Group Inc., the largest U.S. health insurer, last month reported that its second quarter profit more than doubled to $859 million, while its revenues surged 79% even as enrollments fell. In other words, the company made more money from fewer people. Not every health insurer had such strong results, but a look at recent second quarter earnings reports shows that most continue to earn large profits even as the economy stagnates and tens of millions of Americans go without health insurance.
The comments these insurance company executives made to Wall Street offer an enlightening account of how they plan to grow their profits and how attention to the bottom line trumps their ostensible mission of providing affordable health care to all Americans. This view was articulated most clearly by Aetna Inc. CEO Ron Williams, who said on a conference call with industry analysts, “We would be willing to forgo membership growth if necessary. We have a clear bias toward profitability over growth.”
Because each health insurer has a unique mix of medical, dental, and prescription drug operations as well as different combinations of Medicare, Medicaid, and employer-sponsored enrollees, each has its own strong points and problem areas. What unites them all is a determination to profit from whatever economic trends emerge in the future. This is, of course, to be expected from publicly-traded companies with a legal responsibility to maximize earnings to shareholders. It does, however, illustrate how efforts to profit from health care can be inherently at odds with making health care widely available and affordable. These two cross purposes become most apparent when the health industry addresses the financial community.