Several health insurers have seen their profits climb amid the COVID-19 pandemic as the use of healthcare services fell.
The Kaiser Family Foundation issued a brief Oct. 12 that analyzed how the pandemic has affected health insurers’ profits. Researchers analyzed financial data from 2013-20 for insurers reporting to the National Association of Insurance Commissioners. The data was compiled by Mark Farrah Associates.
Here are four statistics to know:
1. Average gross margins per member per month, or the average amount that premium revenue exceeds an enrollee’s medical costs in a month, grew across insurers. Through the second quarter of 2020 compared to the same period last year, group market plans saw their gross margins grow by 22 percent, or $20 per member per month.
DistilINFO Healthplan Market Intelligence Report
Your monthly roundup of the US healthplan industry.
2. In that same period, Medicare Advantage plans saw their gross margins rise 41 percent, or $64 per member per month. The foundation noted that in general, gross margins tend to be higher for Medicare Advantage plans.
3. Insurers’ medical loss ratios, or the percent of premium income that insurers use to pay medical claims, have decreased during the pandemic as fewer Americans receive healthcare treatment. MLRs in the Medicare Advantage market fell 5 percentage points in the first half of 2020 compared to the same period last year.
4. During the same period, MLRs in the group market fell by an average of 3 percentage points.
Source: Becker’s Hospitalreview