The country’s largest health insurer, UnitedHealth Group, has warned that it may pull out of Obamacare because enrollment is too low, costs are too high, and billions in net profits just aren’t enough. The move wouldn’t take place until after 2016, but this is a fine example of the profiteering that’s still occurring in the health insurance industry, despite Obamacare.
If they did this, at least half a million people would have to find other coverage that could well be more expensive. According to USA Today, UnitedHealth’s departure would also mean some of the cheapest insurance plans would disappear from the exchanges, screwing Americans in the name of more money.
Companies have to make money, we get it. Perhaps UnitedHealth would have a real argument if it weren’t for the fact that their net profit for 2014 was well over $5 billion. Their net profit for just the third quarter of 2015 was nearly $1.6 billion, which is higher than their net profit for the second quarter, which was higher than their net profit for the first quarter. With their net profits going up (along with their gross profits) they can hardly justify complaining that they’re having money problems.
As if this wasn’t bad enough, UnitedHealth is currently the only major insurer who’s whining like this. NPR reports that Aetna thinks it’s too early to tell whether insurers will have to weigh whether to stick it out or leave. In a disgusting contrast to that, UnitedHealth’s CEO, Stephen Hemsley, said:
“We cannot sustain these losses. We can’t really subsidize a marketplace that doesn’t appear at the moment to be sustaining itself.”
What losses? It’s hard to say there have been substantial losses when they were saying just last month that they expected their performance on the exchanges to improve for 2016, and when they were planning to expand into more state exchanges. In one month, they’ve gone from optimistic to, “Woe is us, we’re losing too much money.”
Pardon us while we call baloney.
UnitedHealth’s money-grubbing CEO made more than $66 million in 2014 alone. His salary was $1.3 million, while he also received a bonus of nearly $4 million, which was up 27 percent from 2013. An astonishing $45.6 million was from his stock options, which could explain why he’s so worried about UnitedHealth’s profits.
They’ve revised their fourth-quarter earnings projection down by $425 million, or roughly $.26 per share, and they’re saying that the public exchange market is now showing zero signs of improvement for 2016. So they’re panicking because, despite overall higher performance for 2015 over 2014, their CEO is scared he might not make as much money next year.
Furthermore, since 2011, UnitedHealth’s share price has been climbing steadily, reaching a peak of $123 per share in July of this year. It’s fallen slightly, but not enough to be a good excuse for saying, “We’re not making enough money.” Take a look at the chart below, which shows their share price for the last five years:
USA Today had this gem in their article, which, in light of what UnitedHealth is saying, destroys the “free market” argument we keep hearing from Republicans who want Obamacare gone:
“UnitedHealth (UNH) downgraded its earnings forecast, bemoaning low growth projections for Obamacare enrollment and blaming the federal health care law for giving individuals too much flexibility to change plans. People who purchase insurance through the public exchanges are typically heavy users of their plans, draining insurers’ profits, analysts say.” [emphasis mine]
Hemsley likewise says that too many people who actually use their insurance are enrolling on the exchanges, and those enrollments aren’t sufficiently balanced by people who won’t use their insurance. So the premiums they’re collecting from the exchanges isn’t enough for them to make a profit on those plans. This is yet another reason why for-profit insurance is cruel and unusual. The people who need insurance the most are the people insurers want to stay away from, all in the name of profits.
The Republicans side with the for-profit insurers, too. They want to throw people back to the wolves with limited help with premiums. From HealthAffairs.org:
“In summary, the plans demonstrate a clear intent to deregulate most consumer protections established in the ACA, and to eliminate the individual and employer mandates. More limited tax-based assistance would be available to fewer consumers and that assistance would not vary by income. Guaranteed issue and the elimination of pre-existing condition exclusions would apply only to individuals who can maintain continuous coverage. Some form of malpractice reform would likely be included.” [emphasis mine]
On the other hand, Kaiser Permanente, which is privately held, shined a different light on the for-profit health insurance industry. They said they’re not going to abandon the ACA. Their CEO, Bernard Thompson, said:
“At Kaiser Permanente, we remain strongly committed to continuing to participate in the health exchanges. While there have been challenges at times, we believe at the end of the day they are causing healthy disruption, and are forcing the health care industry to respond better to consumer needs.”
When it’s all about profit, UnitedHealth’s crapola is what happens. The little guy gets screwed while the huge, profitable company with the obscenely rich CEO complains that profits aren’t high enough, and can only point to a single quarter that isn’t finished to justify their whining. F*ck off, UnitedHealth.