Large Health Insurer Enrollment and Profits

Mark Farrah Associates regularly looks at the enrollment performance of major health plan companies, with the latest report covering 2013 year-over-year with 2012.  The large plans reported on include Aetna, Cigna, HCSC, Humana, Kaiser, UnitedHealth Group and WellPoint.  (Mark Farrah Report)  These plans in total cover 55% of all covered lives at the end of 2013; 143.6 million people, up from 135.6 million at the end of 2012.  In terms of overall enrollment, the changes for a plan are heavily influenced by M & A activity and large contracts.  Aetna gained 21.6%, while UHG added 11.3, while the other plans had minor gains, although Humana and WellPoint each actually lost a few members.  UHG remains the largest, at 40.6 million people covered, with its gains largely due to getting a TriCare contract.  WellPoint was the second largest at 35.6 million people.  Aetna covered 22.2 million lives, with almost all its gains coming from the Coventry acquisition.  Several companies reported exchange enrollment, with Aetna saying it had 135,000 paid members as of January 2014, Humana 202,000 applications through February, Kaiser 300,000 lives in California and Colorado and WellPoint 500,000 applications as of March.

Most of the companies had profit downturns in 2013, although margins remain acceptable and some of the effect may be due to implementation of medical loss ration limits in the reform law.  Among the plans which reported financial results, Aetna had 2013 revenue of $44.4 billion, with earnings of $1.9 billion for a margin of 4.3%, down from 5.1% in the year-earlier period.  Kaiser was at $54.2 billion of revenue and $2.7 billion in earnings with a flat margin; UHG had $113.8 billion revenue, $7.3 billion profit and a 6.4% margin compared to 7.5% in 2012; and WellPoint was $71 billion in revenue, $2.5 billion in earnings and 3.5% versus 4.3% margins.