A Bottom-Line Glimpse of Health Insurance Pricing

ATMForget about young adults signing up for health insurance.

The bottom line for insurers is profit.

I don’t mean that as a criticism. After all, what business doesn’t seek profit?

Two industry insiders put health reform’s Affordable Care Act enrollment in perspective.

As reported by the Washington Post, Aetna’s chief executive officer (CEO) and Wellpoint’s chief financial officer (CFO) do not appear to be losing sleep over the lack of young adults signing up for health coverage.

Check out this quote in the article from Wellpoint’s CFO, Wayne DeVeydt.

“It’s not about whether or not you’re getting a sicker book.
It’s whether you priced for it.”

There you have it.

Regardless of increased rules and regulations, one basic tenet remains.

Premium Minus Cost = Profit

I’ll leave the level of profit debate to those with greater knowledge.

Coverage at a Price

The furor over individuals losing their health coverage emerged from a basic misconception. That you could add layers of coverage requirements with no price consequences.

Long before health reform, I used to share with employees at open enrollment meetings, the more coverage you have, the more it is going to cost you.

Employee benefits attempts to find a balance. And therein lies the challenge.

The high cost of health care, an increasingly unhealthy population, and unexpected costs lead to higher premiums.

As a sole proprietor business owner, I feel your pain.

BigStock Photo Credit


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Notice of Disclaimer –Cathy Miller is not an attorney or health care provider and cannot provide legal or health care advice. The information provided is for your general background only, and is not intended to constitute legal or health care advice as to your specific circumstances. We recommend you review legislation with legal counsel and visit your physician for health care issues.

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