The myopia! In their misguided drive to squeeze every possible drop of profit from health care financing, health insurance companies are sealing their own doom with policies that restrict access to coverage. The latest comes from the American Medical News that reports companies intend to shrink their customer base if necessary to increase profits. From the story:
The nation’s largest publicly traded health plans say they don’t plan to temper premium increases for the sake of keeping members on their rolls — particularly not while they are under pressure from Wall Street over what it sees as their disappointing earnings. Wall Street analysts were shaken over the long-term prospects of the health plan business after bellwethers WellPoint and UnitedHealth Group, the nation’s two largest private-pay plans, reported less-than-expected profits from the first three months of this year.
While no plan said its overall membership has gone down, most say their risk-based commercial numbers–representing traditional employer health benefits–are declining or are not growing as quickly as anticipated. But health insurers say cutting premiums or reducing the rate of increase to keep customers would affect their bottom lines more than losing some members over premium hikes. “We will not sacrifice profitability for membership,” WellPoint President and CEO Angela Braly told analysts during a conference call.
Keep this up Ms. Braly, and you will sacrifice your company’s very existence.
People need access to health care. If the private companies continue to cherry pick and maximize short term profits at the expense of the viability of the very ocean in which they swim, they should not be surprised if they end up one day looking like a shark on a dock fish hook.