Ratings Company A.M. Best announced that it will no longer provide public data ratings for many health plans.
Oregon-based PacificSource completed its acquisition of Primary Health, Inc.
There is a difference between the margins of health insurance and health insurance companies. We think that a recent Wall Street Journal article confuses them and overstates insurance profits.
We list the largest health plans nationwide, ranked by membership and by revenues.
Average health plan stock prices increased 1.8% for the month of August. Nine of the fourteen publicly traded companies experienced improvements in their stock prices. Valuation indicators were slightly negative.
Five of the fourteen publicly traded health plans released their second quarter earnings last month. Despite revenue increases, Health Net’s operating income declined due to higher health benefit costs. Healthspring’s medical and administrative expenses increased, resulting in a decline in operating earnings. Humana’s operating income increased as the company experienced improvements to its health benefit ratios. Molina’s net earnings declined as the company posted large decreases to investment income. Earnings per share rose for Triple-S as the company added more members from its one year Reform ASO contract, in addition to premium rate increases.
Announced on July 31st, Aetna, Inc. signed a definitive agreement to acquire Horizon Behavioral Services, LLC for approximately $70.0 million, subject to customary closing conditions. Coventry announced that it has completed its divestiture of its First Health Services Corporation subsidiary to Magellan, Inc.
Aetna announced Kim A. Keck as its head of investor relations. Anthem Blue Cross and Blue Shield in Wisconsin named Larry Schreiber as its President. Blue Cross of Northeastern Pennsylvania announced William J. Farrell as its Enterprise Chief Financial Officer. Health Alliance Plan appointed Christopher Pike as its Vice President, Information Technology and Chief Information Officer. Humana, Inc.’s Veterans Healthcare Services business named Tim S. McClain as its president and Chief Executive Officer. Regence announced John Stellmon will lead the company’s Health Care Services division, while Scott Kreiling will be succeeding him as Regence BlueShield of Idaho’s president.
This month’s insert measures Sherlock Expense Evaluation Report (SEER) data for evidence of economies of scale. Our study identifies several functional areas where economies of scale are statistically significant but in general, scale effects are few and small. The study has implications for business process outsourcing and other contractual relationships as well as for business combinations and health policy.
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