U.S. health insurers are going through the new wave of policymaking storms in Washington with solid capital and liquidity levels, rating analysts said Thursday.
Joseph Marinucci, a senior director at S&P Global Ratings, and James Sung, an associate director at S&P, said that even some of the events that have looked like setbacks have been good for health insurer ratings.
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Anthem Inc. recently gave up on efforts to acquire Cigna Corp., mainly because of antitrust concerns.
Inability to complete the deals may have been frustrating for the company executives involved, but it eliminated rating agency worries about deal-related financing and company integration problems, the analysts said.
Meanwhile, insurers’ commercial group health insurance operations are growing faster than U.S. gross domestic product, and faster than insurers’ U.S. life and property-casualty operations, the analysts said.
A few years ago, insurers might have worried about the potential for disruption caused by private exchanges, or by hospital-led health plans.
Today, however, private exchange programs are still not big enough to cause much disruption, and many hospitals are struggling to manage their efforts to take responsibility for the financial risk involved with providing health care, Sung said.
“One thing the hospitals have learned is that it’s very difficult to run a health insurance business,” Sung said.