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Health Insurance Companies Profits Drop 147% Due to Health Care Reform

August 6, 2012 2 comments

Health insurance company profit falls 147% due to health care reform.

Insurance company profits are falling despite the fact that enrollment is skyrocketing. Falling profits are specifically due to insurance companies violating Health and Human Services’ ingenious medical loss ratio rule which requires companies to pay premiums on actual medical care (not profits) or be forced to pay rebates back to their customers. Insurance companies are on pace to pay out $1.3 billion this year alone on rebates. The fact that insurance company profits is falling is a clear sign that health care reform is working!
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Aetna  – Profit drops 15% (Source 5)
Cigna –  Profit drops 44%  (Source 1, 2, 4)
Humana – Profit drops 80% (Source 3, 5)
WellPoint (aka BCBS) – Profits drops 8% (Source 6)
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Health insurance company profits continue to fall due to the implementation of health care reform. Executives and  shareholders will continue to lose profits as long as they continue to violate Health and Human Services’ ingenious medical loss ratio.

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Sources:

Blue Cross Blue Shield Can Lose Tax Exemption Under Health Care Reform

July 20, 2012 Leave a comment

Blue Cross Blue Shield and other non-profit health insurance companies can lose their tax exemption if they do not spend 85% of their premiums on actual medical care (not profits or compensation for executives) thanks to Section 9016 of the Affordable Care Act. Here is the exact language of the provision:

(Sec. 9016) Requires Blue Cross or Blue Shield organizations or other nonprofit organizations that provide health insurance to reimburse at least 85% of the cost of clinical services provided to their enrollees to be eligible for special tax benefits currently provided to such organizations.

Health Insurance Companies Raise Premiums by 181.4% Since Health Care Reform Passage

July 5, 2012 Leave a comment
We are barely 7 months into 2012 and already health insurers are dramatically hiking premium rates. Specifically, they are raising premiums in order to get as much profit as possible. The insurers themselves refuse to justify their rate hikes publicly because they claim they would be giving away “trade secrets” (Source 1).  As you will see in the data below, the country’s largest  insurers have raised premiums by 181.4% (16.5% average) since health care reform officially passed in 2010. Approximately 787,000 policy holders were effected. The insurers were fined a whopping total of $116,750,000 as a result of their deed. The Affordable Care Act (ACA) is supposed to curb this unethical act but the consumer will not see significant relief from this until 2014.                                                            R74BG8W84C8B
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Rate Hikes By Insurer
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Aetna
8% increase   – April 2012 (Source 3)
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Blue Cross Blue Shield
20% Increase  – July 2012
7% increase   –  May 2012 (Source 2)
9.35%  increase  – January 2012 (Source 5)
12.9% increase   – September 2011 (Source 6)
22% increase     – May 2011 (Source 8)
59% increase     – January 2011 (Source 9)
12.4% increase small group  – May 2010 (Source 10)
13.4% increase large group – May 2010 (Source 10)
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Kaiser Permamente
10% increase – June 2011 (Source 7)
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United Healthcare
11.8% increase on businesses of fewer than 50 employees  – May 2010 (Source 10)
15.5% increase on business of greater than 50 employees  – May 2010 (Source 10)
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Members Effected by Rate Increase
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Aetna
73,000 members   – April 2012  (Source 3)

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Blue Cross Blue Shield
90,000  – July 2012
31,000   – April 2012     (Source 2)
86,000    – January 2012 (Source 5)
45,000   –  September 2011 (Source 6)
59,000   – May 2011  (Source 8)
193,000  – January 2011 (Source 9)
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Kaiser
300,000   – June 2011  (Source 7)
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Impact on Profit
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Aetna
Profit UP 27.7% due to 8% premium increase  (Source 4)
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Fines for Rate Increases
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Assurant fined $2,750,000 for unapproved rate increase  – May 2012 (Source 11)
11 insurers (United Healthcare, Aetna, Blue Cross Blue Shield) fined $114,000,000  -January 2012 (Source 12)
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Sources:
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1. http://www.nytimes.com/2011/10/12/nyregion/health-insurers-ask-to-keep-rate-increase-data-secret.html?_r=1&scp=1&sq=health%20insurers%20ask%20to%20keep%20rate%20increase%20data%20secret&st=cse
2. http://www.elpasotimes.com/ci_20733206/blue-cross-raising-rates-31-000?source=most_emailed
3. http://articles.latimes.com/2012/apr/05/business/la-fi-mo-aetna-raises-rates-20120405
4. http://www.fiercehealthpayer.com/story/aetna-ignores-regulator-implement-8-rate-hike/2012-04-09
5. http://www.kcrg.com/news/local/State-Approves-Wellmarks-Health-Insurance-Premium-Hike-136611573.html
6. http://www.ctmirror.org/story/13806/anthem-proposes-129-percent-rate-increase
7. http://www.sfgate.com/business/article/Kaiser-raising-rates-for-300-000-subscribers-2366454.php
8. http://www.oregonlive.com/health/index.ssf/2011/05/oregons_largest_health_insurer.html
9. http://latimesblogs.latimes.com/money_co/2011/01/rate-increase-by-blue-shield-of-california-prompts-criticism.html
10. http://www.fiercehealthpayer.com/story/insurance-premiums-more-double-digit-hikes-sought-ri-mi-and-ct/2010-05-24
11. http://www.in.gov/idoi/files/Assurant_Press_Release_5-16-2012%281%29.pdf
12. http://www.governor.ny.gov/press/110911health
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Keywords: health care insurance, insurance premium, blue cross blue shield, health insurance company, united healthcare, health care reform

Health Insurance Companies to Pay $1.3 Billion in Rebates for Violating Medical Loss Ratio Rule

July 5, 2012 Leave a comment

There is finally some good news coming out of the ACA in regards to the fact that the Medical Loss Ratio is in full effect. Under this rule, large plan insurers (Humana, United, BCBS, etc) must PAY 85% of premiums towards providing actual medical care(not profits). In addition, small plans must PAY 80% of premiums towards providing actual medical care as well. These money-loving insurers should thank God that this rule was not in place back in 2010 because if it had been, they would have had to cough up $2,000,000,000 for violating the rule (Source 1). According to a report done by the Commonwealth Fund, Individual market insurance companies in Texas and Florida would have had to pay rebates back to consumers totaling $281,000,000. Large group Insurers in Maryland and Florida would have had to pay $40,000,000 in rebates back to consumers (Source 1).

Insurers are already off to a brilliant start this year at violating the MLR. The National Journal reports that Insurers could cough up $1,300,000,000 in rebates by the end of the year. This will account for $426,000,000 in rebates to the individual plan market and $541,000,000 to the large group plan market (Source 2).  An estimated 4,900,000 in the individual market  will be getting rebates this year totaling $377,000,000. Alaska, Alabama, Oregon, Louisiana, and Massachusetts are expected to receive an average of $256.50 per enrollee. An estimated 7,500,000 in the large group market will be getting rebates this year totaling $541,000,000. Vermont, Nebraska, Minnesota, New York, and North Carolina are expected to receive an average of $208.60 per enrollee (Source 3). If the MLR had been in effect in 2010, the total amount in rebates that could have been paid out by the end of this year could have totaled $3,300,000,000.
The following insurers (so far) have had to pay out rebates back to consumers for violating the MLR rule.
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Aetna
$11,495,614     – November 2011 (Source 6)
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Blue Cross Blue Shield
$82,507,470       – November 2011       (Source 6)
$283,000,000  – October 2011            (Source 5)
$167,000,000  – September 2011        (Source 4)
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CD PHP
$487,768    – November 2011 (Source 6)
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ConnectiCare
$15,462      – November 2011 (Source 6)
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Group Health
$4,168,935   – November 2011  (Source 6)
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Health Net
$5,052,467    – November 2011 (Source 6)
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Health Now
$4,492,327   – November 2011 (Source 6)
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HIP Health Plan
$182,194    – November 2011  (Source 6)
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Humana
$5,144,676  – November 2011
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MVP
$1,319,640
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United Healthcare
$4,838,675  – November 2011 (Source 6)
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Keywords: health care, affordable health insurance, medical loss ratio, insurance rebate, blue cross blue shield, united healthcare, health care reform

Health Insurance Companies Fined $88.8 Million for Overcharging Federal Employee Health Benefit Plan

June 27, 2012 1 comment

Over the past decade, health insurers have been fined $88,800,000 for overcharging the Federal Employee Health Benefit Plan on purpose. Blue Cross Blue Shield was fined $1,500,000 (Source 1) and United Healthcare (Source 2) was fined $87,300,000 for their deeds.

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Sources:
1. http://www.govexec.com/federal-news/2005/08/fehbp-contractor-agrees-to-pay-15-million-settlement/19982/  2. http://www.californiahealthline.org/articles/2002/4/15/pacificare-pays-87m-to-settle-fehbp-overcharges-case.aspx

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Keywords: health care, health insurance, employee health, health benefits, federal government, blue cross blue shield, united healthcare

Health Insurance Companies Fined $767 Million for Recissions (Denials)

June 26, 2012 Leave a comment
Health insurance companies have a “fetish” for denying people access to health care. The only reason they do this is to gain/ save company profits for their shareholders and to pay high compensation packages to executives. This evidence is clear in the raw data posted below. According to the data, insurers have specifically denied 25,871,003 (publicly reported) and have been fined $768,755,406  over the past decade. Unfortunately, the denial by the health insurance companies have caused “murder” 4 times (publicly reported) and had judgments due to the “murders” totaling $131,900,000.  In several instances, health insurance companies denied 21,600 claims just to gain $335,500,000 in profit. As a result, an executive was paid a $20,000 bonus for each person denied. In addition, the overall average denial rate by health insurance companies is 30.2%. For-profit Aetna fined the most for denials by a whopping $325,500,000. Nonprofit Blue Cross Blue Shield fined a whopping $205,957,000.
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Deaths caused by Insurer Denials
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Aetna (publicly traded)
# of deaths:  1   (Source 39)
judgments:   $124,500,000  (Source 39, 40)
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Cigna (publicly traded)
# of deaths:   1   (Source 36)
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Humana (publicly traded)
# of deaths:   1   (Source 37)
judgement:   $7,400,000    (Source 37)
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Magellan (publicly traded)
# of deaths:  1    (Source 38)
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Denied in order to save Profit (Evidence!)
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Health Net
Saved  $35,500,000 by denying 1,600 claims. Senior analyst got $20,000 bonus as a result.  (Source 21)
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United Healthcare, Blue Cross, Assurant
 Saved  $300,000,000  by denying 20,000 claims  (Source 34)
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Claims Denied by Insurer
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Assurant
# of claims:  20,500                      (Source 4)
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Blue Cross Blue Shield
# of claims:  10,263,365   (Source 2, 3, 9, 10, 18, 22, 27, 28, 29, 30, 33)
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Health Net
# of claims: 7,619,266        (Source 1, 23, 33)
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United Healthcare
# of claims: 7,967,872     (Source 6,7, 12, 17, 33)
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Insurer Denial Rates
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Aetna
denial rate:  13% (Source 33, 35)
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Blue Cross Blue Shield
denial rate:  28%   (Source 33, 35)
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Cigna
denial rate:  33%  (Source 33, 35)
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Health Net:  30% (Source 33, 35)
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Humana:  40%   (Source 35)
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Kaiser
denial rate:  28% (Source 33, 35)
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United Healthcare
denial rate:  39.6%  (Source 33, 35)
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Reasons for Denial by Insurer
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Aetna
denied qualified applicants coverage ( Source 1)
denied stomach cancer treatment (Source 32)
denied mental health, pap smears, mammograms, pediatric care (Source 41)
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Amerigroup
denied pregnant women on Medicaid access to care (Source 20)
failed to allow pregnant women to enroll in Medicaid (Source 20)
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Blue Cross Blue Shield
denied coverage to newborns (Source 1)
denied access to emergency care (Source 2, 3)
denied prosthetic legs (Source 8)
denied seniors access to drugs (Source 9)
denied anorexia treatment (Source 10)
denied routine colonoscopy (Source 11)
denied treatment for glutaric academia (Source 12)
denied mental health coverage (Source 18)
denied chemotherapy, physical therapy (Source 19)
denied people when they got sick (Source 22)
denied people when they got sick (Source 24)
denied sick children coverage     (Source 26)
denied women access to contraceptives (Source 27)
denied women coverage due to breast cancer diagnosis (Source 28)
denied women access to contraceptives (Source 29)
denied emergency room claims (Source 30)
denied pediatric cardiac lead tests (Source 31)
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Cigna
inappropriate denials  (Source 1)
denied liver transplant, patient died (Source 14)
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Conseco
improper denials (Source 1)
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Coventry
denied Medicaid patients drug needed by pregnant women (Source 1)
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Health Net
denied qualified claims  (Source 1)
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Kaiser
denied patients access to emergency care, resulted in 3 deaths (Source 2)
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Qualmed
denied patients access to emergency care (Source 2)
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United Healthcare
denied patient claims for emergency care (Source 2)
denied surgeons from scheduling legitimate surgeries (Source 6)
denied children access to pediatric care (Source 6)
denied patients with pre-existing conditions (Source 7)
improperly denied qualified claims  (Source 13)
denied anesthesiology claims  (Source 16)
denied qualified physician claims (Source 17)
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Fines for Denial by Insurer
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Aetna
Fined $327,055,000 (Source 1, 32, 39, 40, 41)
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Amerigroup
Fined $162,000,000  (Source 20)
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Blue Cross Blue Shield
Fined $205,957,000 million   (Source 1,2,3,10,15,19,22,24,26,27,28,29,30)
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Cigna
Fined $400,000    (Source 1)
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Conseco
Fined $500,000  August 2009 (Source 1)
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Fortis
Fined $15,000,000   (Source 5)
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Health Net
Fined $25,000,000  (Source 23)
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HMO Colorado
Fined $252,500     (Source1)
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Humana
Fined $7,400,000  (Source 37)
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Kaiser
Fined $1.1 million    June 2002 (Source 2)
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QualMed
Fined $25,000  (Source 2)
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United Healthcare
Fined $24,065,906   May 2009  (Source 1,6,7,12,17)
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Sources:
24. http://articles.latimes.com/2006/sep/22/business/fi-revoke22

41. http://www.mass.gov/ago/news-and-updates/press-releases/2012/2012-06-27-aetna-life-insurance.html
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Keywords:

Accountable Care Organizations Caught Defrauding Medicare by $2.20 BIllion!

June 25, 2012 Leave a comment

Accountable Care Organizations (ACOs) have been established and are operational. Blue Cross Blue Shield, Cigna, Humana, and United Healthcare specifically already have theirs set up. Unfortunately, these same companies have been caught by the U.S. federal government defrauding Medicare on purpose by a whopping $2,208,408,879 billion.
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Actual Fraud Amount:  $522,180,879  (Source 1,2,3,4,17
Settlements:                    $302,100,000  (Source: 5,6,7,8, 9, 17, 18)

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Cigna
Actual Fraud Amount:  $74,500,000
Settlements:                          $58,000,000  (Source 16)
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Humana
Actual Fraud Amount:   $311,800,000
Settlements:                     $155,500,000  (Source: 10,11,12,13)
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United Healthcare
Actual Fraud Amount:    $1,300,000,000  (Source 14)
Settlements:                       $97,500,000       (Source 15, 16)
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Sources:
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