Record profits achieved by the five largest U.S. health insurers last year were possible only because of a combination of dropped coverage and raised rates, a new report by liberal activist group Healthcare for America Now (HCAN) claims. According to the report, a total of 2.7 million Americans lost coverage in 2009 while health insurance's big five--UnitedHealth Group, WellPoint, Aetna, Humana and Cigna--earned a combined $12.2 billion.
Only one of those five--Aetna--experienced a profit decline from 2008 to 2009:
- Aetna's profit declined $108 million, or 8 percent, from 2008, to $1.28 billion.
- UnitedHealth's profit increased $845 million, or 28 percent, from 2008, to $3.8 billion.
- Humana's profit increased by 61 percent--$393 million--from 2008, to $1 billion.
- WellPoint's profit increased $2.3 billion--91 percent--from 2008, to $4.75 billion (a new company record for annual net income).
- Cigna's profit increased $1 billion, or 346 percent, from 2008, to $1.3 billion, which also set a record for annual net income.
"[The insurers] will say the increases are justified because medical care is going up, and they'll hide behind their actuaries to explain their rate increases," said Rep. Rose DeLaura (D-Conn.), according to The Now! Blog, which represents HCAN. "But this is coming from the same people who've been saying health insurance reform will increase costs. They can't have it both ways."
Robert Zirkelbach, a spokesman for America's Health Insurance Plans, was critical of HCAN's reporting methods. "It is disingenuous to look at the profits at one company today compared to where it was in the depth of a recession," Zirkelbach told the Los Angeles Times.