U.S. health insurers go international, but British invasion raises some ire

With health reform bringing so many uncertainties to the U.S. healthcare market, health insurers increasingly are looking at international markets to spur growth. For example, Philadelphia-based Cigna considers global markets "a cornerstone of our growth strategy," CEO David Cordani told the Intelligent Investing team at Forbes. Cigna currently has a presence in 27 different countries and more than 5.5 million individual policies outside of the United States. The company has put a significant emphasis on southeast Asia. "By the end of this year, in China alone I expect to have a million policies [primarily supplemental policies] in force at the individual level," said Cordani.

Other U.S. health insurers are rushing to build their business in Great Britain. Humana, UnitedHealth Group and Aetna have all thrown their hats in the ring to participate in the British government's plan to reform the National Health Service, which would transfer healthcare purchasing power from the existing primary care trusts (PCTs) to consortiums headed by general practitioners (GPs). Under this plan, most of the GP consortiums' administrative work would be outsourced to private companies.

U.S. firms are bullish about the opportunities in Great Britain under a GP-led system. "We have huge resources that can be put at the disposal of GPs who will have a much bigger say on where to refer patients," Humana spokesman Lee Philips told the Guardian. "Humana is already a commissioning support company that offers primary care trusts a complete end-to-end service. Are we optimistic? You bet we are." In fact, Minnetonka, Minn.-based UnitedHealth has already beaten out both Humana and a British firm to win a health department contract to advise PCTs on dealing with the transition, reports the Guardian. (UnitedHealth currently runs two GP practices in Derbyshire and three in London.)

However, the Guardian and other news outlets are up in arms over the government's outsourcing move--particularly the involvement of U.S. corporations that have run already afoul of state regulators and the legal system in America. For example, in an article about UnitedHealth's contract to advise the PCTs, the Sunday Mirror accused the company of having "a catalogue of cheating." Likewise the Guardian noted that UnitedHealth "has faced accusations of overcharging and malpractice in a series of legal suits."

The health services union Unison also added a note of caution. "The profit motive is not a panacea, and we think standards of patient care could deteriorate," said spokeswoman Karen Jenning. "Specialist services could disappear altogether in areas where there is little demand for them."

To learn more:
- read the Intelligent Investing transcript at Forbes
- read these Guardian articles: article 1, article 2, article 3 and article 4
- read this Sunday Mirror article

Suggested Articles

In a letter, 111 physician organizations weighed in on surprise billing, urging Congress not to turn more power over to health insurers.

Even when taking into account increased resources, general and vascular procedures performed in teaching hospitals are better for high-risk patients.

As members of Congress wrangle over the best way to stop surprise medical bills, one senator predicts Washington will pass a new law soon.