Profits put health plans in difficult spot

Nobody would suggest that health insurers shouldn't be profitable. But during the past year of reform ferment--with health plans targeted as villains--things got a bit tense for plans that posted decent numbers.

It got particularly awkward for Humana last month, when a modest 4 percent profit during Q3 put it in the sights of reformers. The Q3 report came out in the wake of a skirmish between Humana and CMS, which took exception when the plan sent a letter to seniors suggesting that health reform could gut their benefits.

Legislators were quick to note that Humana's Medicare Advantage business had a good quarter, adding 146,800 members and taking in 18 percent more in premiums than it had during the same quarter of the previous year. Legislators pounced on this result, arguing that it was the main reason the health plan giant was so anti-reform.

As it turns out, the Senate's final version of the health reform bill isn't too hard on health insurers. For one thing, the bill leaves the antitrust exemption for national health plans in place; and while it does set minimum medical spending requirements for plans, the provisions are written loosely enough to give health plans plenty of loopholes, it seems. Still, health insurers got a fair amount of bad press over the past year or so; it may take a while before the public calms down.

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