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Mark Farrah: Big health insurers still thriving

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Analysts at Mark Farrah Associates say the big health insurers they track looked fine in the second quarter.

Many of the young nonprofit, member-owned Consumer Operated and Oriented Plan (CO-OP) carriers have failed in recent weeks, amidst reports that high 2014 and early 2015 medical claims and problems with Patient Protection and Affordable Care Act (PPACA) risk stabilization programs had hurt their performance.

The failures raised questions about whether some traditional carriers might be facing problems as a result of PPACA commercial health insurance market changes.

But the Mark Farrah analysts say all of the four big carriers the firm screens for profits did well in the second quarter, and three increased their profit margins.

At Kaiser, the profit margin fell to 6.6 percent in the second quarter of 2015, from 7.5 percent in the year-earlier quarter, but margins increased to 5.1 percent, from 4.6 percent, at Aetna Inc. (NYSE:AET); to 6 percent, from 5.4 percent, at UnitedHealth Group Inc. (NYSE:UNH); and to 4.4 percent, from 3.9 percent, at Anthem Inc. (NYSE:ANTM), according to a Mark Farrah report.

See also: Mark Farrah: Big health insurers still profitable

Analysts at the firm track enrollment at those carriers and three others: Cigna Corp. (NYSE:CI), Humana Inc. (NYSE:HUM) and Health Care Service Corp., the member-owned parent of the Blue Cross and Blue Shield plans in Illinois, Texas and other states.

Overall medical plan enrollment increased at all of the companies but Humana, and the number of people with insured coverage, as opposed to self-insured plan employer coverage or public plan coverage administered by a carrier, increased at all of the seven carriers except for Humana and Aetna.

Even at Humana, a large increase in insured enrollment mostly offset a 10 percent drop in administrative-services-only enrollment, the analysts found.

See also: Commercial health enrollment drops at ‘non-Blues’


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