Friday, August 14, 2020

Pandemic? Alright for Health Insurers

 US health insurers doubled profits in the second quarter of 2020 compared with the same time last year.

US’s largest health insurer, UnitedHealth Group, reported $6.7bn in profits compared with $3.4bn for the same quarter last year. Anthem’s profits rose to $2.3bn from $1.1bn for the same three-month period in 2019. Humana reported last week its earnings rose to $1.8bn, compared with $940m in 2019.

The cost of providing medical care was lower in 2020. People were avoiding the doctor’s office and delaying elective surgeries such as knee replacement. Those with mild symptoms of Covid-19 were initially advised to stay home unless they needed urgent care.
But the money insurance companies collect each month from individuals, known as premiums, kept pouring in. “Private insurance companies make money by taking in premiums and not paying for care,” Dr Steffie Woolhandler, professor at Cuny Hunter College and co-founder of Physicians for a National Health Program.
The drop in spending was a benefit for insurers, but has left already struggling independent doctor’s offices and rural hospitals vulnerable to closures and layoffs. In late July, 20% of clinicians had salaries skipped or deferred over the previous four weeks and 24% reported recent layoffs or furloughs, according to a survey.
Andy Slavitt, a health official in Barack Obama’s administration, tweeted last week. “It’s a system designed for & by insurance companies & pharma companies. Not us. Not doctors and nurses.”

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