It’s not hard to understand why insurers and pharmaceutical companies oppose health reform:
As the nation struggled last year with rising health-care costs and a recession, the five largest health-insurance companies racked up combined profits of $12.2 billion, up 56 percent over 2008, according to a new report.
Based on company financial reports for 2009 filed with the Securities and Exchange Commission, the report said insurers WellPoint, UnitedHealth Group, Cigna, Aetna and Humana covered 2.7 million fewer people than they did the previous year.
The report also said three of the five insurers cut the proportion of premiums they spent on customers’ medical care, committing relatively more to salaries, administrative expenses and profits.
Even so, insurance companies have also offloaded their most expensive patients by cancelling their policies and raising premiums drastically, Kirsch asserted in a Thursday press call.
Among the report’s findings on specific insurance companies:
- Wellpoint increased profits 91 percent from 2008 while it chopped 3.9 percent of its total enrollment.
- United Health’s profit increased 28 percent from 2008, while enrollment dropped by 3.4 percent.
- Cigna’s profit increased 346 percent and enrollment dropped 5.5 percent.
- Humana’s profit increased by 61 percent while enrollment decreased by 1.7 percent.
- Aetna was the only company with a drop in profit and a gain in enrollment. The company’s profit declined by 8 percent from 2008, and enrollment grew by 7 percent.
Two things stand out in the exchange between Sebelius and spokesmen for the health plans. First, to hear industry flacks tell it, the health insurance plans in question are barely surviving, poor souls, with profits at or below those of rivals. Second, the federal government, for all Sebelius’ handwringing, has little power to rein in the insurance giants.
The insurance industry is one of the lucky few that enjoy exemption from federal antitrust regulation, an enormous and incomprehensible loophole in view of the power the insurance giants exert over American life. They’re regulated — to use that word liberally — by the states, which is the way they like it.
GlaxoSmithKline Thursday met forecasts with a 32% jump in fourth-quarter net profit–inflated by pandemic flu products and higher contributions from consumer healthcare operations and emerging markets–but said it will reduce investment in some disease areas and cut more infrastructure costs and jobs as the world’s second-largest drugmaker continues to diversify away from its core pharmaceutical business.
Swiss drugs firm Roche has reported an 8% rise in annual sales, helped by sales of swine flu drug Tamiflu and cancer treatments, such as Herceptin.
Bristol announced net earnings attributable to the company were $8 billion for the three months ended Dec. 31, or $4.06 a share, up from $1.2 billion or 63 cents a share, last year.
Medicynical Note: Patient care has become an afterthought.