Big Insurers’ Panels Headin’ South

May 8th, 2009 | Sources: Wall Street Journal

Subjects: ,

In Q4 2008, WellPoint lost 288,000 covered lives, half of which were caused by rising unemployment and lost employee benefits.

floodofbadnews“Economic conditions will continue to deteriorate and unemployment will continue to increase,” CEO Angela Braly sighed to analysts at the time. “This will impact commercial membership in 2009.”

She got that right.

The nation’s largest private insurer, which covers nearly 35 million lives, reported last week that it lost nearly half a million more members in Q1 2009, nearly 65% of which were due to layoffs or employees simply opting out of employer coverage.

That jaw-dropper was topped the next day by UnitedHealth Group Inc., the second largest insurer. The Minnesota-based company reported a drop of 900,000 in the number of people enrolled in its commercial health plans.

The news prompted economists to estimate that the uninsured population has swelled by at least 4 million people since the 2007 estimate by the Census Bureau pegged the number at 45.7 million.

The Kaiser Family Foundation estimates for example that for each percentage-point increase in the unemployment rate, the population of uninsured Americans grows by 1.1 million.

The findings were confirmed by Tenet Healthcare, a hospital chain that recently reported a 2% drop, year-over-year, in the number of admissions of patients with private coverage.

“It’s probably not a surprise that with all these people losing jobs, a lot will lose their health insurance,” Paul Ginsburg, president of the Center for Studying Health System Change told the Wall Street Journal.


 

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