Dive Brief: Health insurer Aetna announced Tuesday it earned $244 million in net income in Q4 2017, $0.74 per share, with adjusted earnings of $411 million, $1.25 per share. Over the course of 2017, the company collected $1.9 billion in net income, with $3.3 billion in adjusted earnings. The insurer says its Q4 net income represents a 76% increase compared to the $139 million of profit posted during Q4 2016. Aetna, which is in the process of being bought by CVS Health, did not hold an earnings call, citing the pending $69 billion deal. The company says that it does not expect to hold earnings calls in future quarters. Dive Insight: CVS Health and Aetna agreed to merge December 3. The deal, if completed, would combine Aetna's health insurance business and CVS's pharmacy benefit manager and retail pharmacy services to create a new company with annual revenues of about $240 billion. According to Aetna's Q4 announcement, the deal is still expected to close in the … [Read more...] about Aetna posts strong Q4 profits, awaiting CVS Health merger
Aetna group health insurance
Dive Brief: CVS Health has agreed to purchase Aetna in a deal valued at $69 billion. The deal would combine CVS's retail pharmacy services with Aetna's health insurance business, resulting in a company with annual revenue of $240 billion — second only to Walmart in the U.S. The transaction is expected to close in the second half of 2018. "Aetna will operate as a stand-alone business unit within the CVS Health enterprise and will be led by members of their current management team," a joint statement noted. Dive Insight: In a massive deal that will ripple through the healthcare industry, CVS Health's acquisition of Aetna creates a behemoth healthcare company with significant market power. The implications of the massive deal are many, but also not fully clear. Moody’s Vice President Mickey Chadha said the deal creates a company of “unsurpassed scale and reach in the industry and the potential to reshape the entire health plan market.” Chadha said … [Read more...] about CVS Health to buy Aetna in $69B deal
UPDATE: Damn, health insurance companies are back at it again with the premium increases. The federal government said Monday that premiums for midlevel health plans under the Affordable Care Act will increase by 25 percent on average in 2017, as reported by the New York Times. This is huge compared to last year’s seven percent increase. Check out our explanation from last year on why your rates are going up—it still applies today:I received a standard-looking letter from my health insurance company recently, so naturally, I ignored it.When I finally decided to open and actually read it, I nearly had a heart attack: Somewhere in the third paragraph, I was informed that my health insurance premium is going up…by nearly $200 a month.Actually, they didn’t tell me it was going up—the letter just briefly mentioned a new, much higher amount and apparently hoped I wouldn’t notice.But I did, and I was pissed. Since I’m self-employed and my husband … [Read more...] about Why the F*&k Did My Health Insurance Just Go Up So Much?
Health insurance is a type of insurance coverage that covers the cost of an insured individual's medical and surgical expenses. Depending on the type of health insurance coverage, either the insured pays costs out-of-pocket and is then reimbursed, or the insurer makes payments directly to the provider. In health insurance terminology, the "provider" is a clinic, hospital, doctor, laboratory, health care practitioner, or pharmacy. The "insured" is the owner of the health insurance policy; the person with the health insurance coverage. In countries without universal health care coverage, such as the USA, health insurance is commonly included in employer benefit packages and seen as an employment perk. Everybody at some time in their life, and often on many occasions, will need some kind of medical attention and treatment. When medical care is required, ideally the patient should be able to concentrate on getting better, rather than wondering whether he/she has got the resources to pay … [Read more...] about What Is Health Insurance?
Dive Brief: On Friday, the New York Department of Financial Services released the approved health insurance rates for 2017. On average, individual premiums in the state will increase by 16.6%. On average, small group premiums in the state will increase by 8.3% Dive Insight: It's not a surprise that health insurance rates would be increasing. The writing had been on the wall when requested premium rates began to trickle in. In May, New York insurers' submitted individual premium rate requests averaged 17.3% for 2017. In addition, a recent analysis by McKinsey & Co., released found aggregate losses in the indivudal market overall for 2015 more than doubled from the previous year, leaving insurers with post-tax margins between -9% and -12%. Those losses coupled with the fiscal losses as a result of the risk adjustment and risk corridor programs would justify premium rates as the insurers want to see a profit on the ACA exchange … [Read more...] about Moving on up: New York releases approved health insurance rates for 2017
Correction: An earlier version of this article, based on source reporting from STAT News, stated that the American Medical Association supported the Campaign for Consumer Choice. The AMA says it "has offered no direct or indirect support to the CCC." Dive Brief: The Campaign for Consumer Choice, which presents itself as a grassroots effort to fight insurance mergers on the public's behalf, is actually being run by hospital and medical organizations, according to a STAT report. The campaign involves groups lobbying in five states to prevent the pending mergers of Cigna with Anthem, and Aetna with Humana. The groups operate a set of similar websites that detail the risks to consumers of insurance industry consolidation and reduced competition yet they do not address hospitals' stake in the issue, which is preventing insurers from growing their negotiating power to further reduce rates to hospitals and providers. Dive Insight: The Greater New … [Read more...] about Hospitals prop up ‘grassroots’ group opposing insurance mergers
On Friday, Anthem announced it had reached a deal to acquire Cigna. Earlier this month, Aetna announced it would be buying Humana – and suddenly, the Big Five health insurers could be shrunk to three. As with the recent flurry of hospital mergers and acquisitions, the biggest driving force for the current insurance industry mergers is likely the Affordable Care Act (ACA). The New York Times says that although the ACA is bringing insurers more revenue by way of additional customers, greater pricing transparency and government funding cuts have also put more pressure on their profit margins. According to The Washington Post, some analysts are saying insurance companies are increasing their scales in an effort to cut administrative costs because the ACA has limited the amount of profit the plans can make. Larger companies will also allow insurers to make more efficient technology investments and eliminate duplicate departments and give them more negotiating power when dealing with … [Read more...] about What’s driving the big health insurance mergers?
Aurora, Newtown, Isla Vista. These tragedies have thrust mental health into the national spotlight. According to the Kim Foundation, 26.2% of Americans age 18 and older, an estimated 57.7 million people, suffer from a diagnosable mental disorder. A CASAColumbia (National Center on Addiction and Substance Abuse at Columbia University) report estimates another 40 million Americans age 12 and older, or roughly one in seven people, have an addiction disorder. Yet, about 60% of those with mental illness received no treatment in the previous year and only 4.1 million of addicts receive treatment every year. Besides the stigma associated with mental illness and substance abuse, other challenges remain. These include dwindling numbers of psychiatrists, access to treatment, lack of health insurance, regulatory and technology hurdles, and cuts in federal funding. Yet, it seems investors see a different picture – a fragmented industry with small regional operators – with … [Read more...] about The ripeness for the behavioral health market is now
Dive Brief: Medical Mutual announced it will acquire HealthSpan, a former Kaiser Permanente of Ohio insurance company, according to a Crain's Cleveland Business report. HealthSpan will continue coverage of its employer-sponsored plan members until their renewal date or Aug. 31, whichever one comes first, and coverage for individual members until Dec. 31. Medical Mutual Chief Ccommunications Officer Jared Chaney said it will offer plans comparable to what HealthSpan offered, and will likely have the same physicians in their network. Dive Insight: HealthSpan's operations will cease on Jan. 1, 2017. The company announced earlier this year it was planning to dissolve its medical group and move forward only as an insurer. However, the market's tough competition proved too much. "We were a small plan and not able to make the growth needed to be sustainable or viable in the marketplace," said HealthSpan's spokesman, Chuck Heald. Mergers and … [Read more...] about Medical Mutual acquires HealthSpan’s insurance
Dive Brief: Aetna and Humana have extended the deadline to complete their merger from Dec. 31 to Feb. 15 so that a federal judge can rule on the proposed deal, according to a Thursday regulatory filing. This is the second delay in finalizing Aetna’s $37 billion acquisition of Humana. Their contractual deadline was originally June 30. Closing statements in an antitrust trial aimed at blocking the megamerger concluded on Wednesday and a decision is anticipated next month, which is what prompted the extension, Louisville Business First reports. Dive Insight: Much of the government’s case has focused on concerns that the $37 billion transaction would give Aetna too much control of the Medicare Advantage market, where Humana is also a large player. In arguments earlier this month, the Department of Justice challenged Aetna’s assertion that a planned sell-off of assets would allay those concerns. Connecticut-based Aetna has agreed to sell $117 million in … [Read more...] about Aetna, Humana extend planned merger end date