 Image: merfam under CC 3.0 |
Humana, one of America’s major health insurance companies, has reported higher-than-expected profits for the first quarter. Their net income was $258.8 million.
Despite their success, investors fear that affordable health insurance reform will cut into those profits in the future. Much of the income resulted from Medicare Advantage programs, which will see cuts due to the new law. Their individual health insurance plans will be especially affected.
 Image: Valerie Everett under CC 3.0 |
Most health insurance companies are ramping up their promotion of wellness campaigns. Their strategy involves reducing the cost of claims–and therefore the price of premiums–by improving the health of policyholders. Many of these programs involve weight loss and improvements in diet.
Strangely, it has been found that many insurers are major stockholders in fast food corporations! In total, they own about $2 billion worth of stock in McDonalds, Burger King, KFC, and Taco Bell; as well as other similar restaurants. These companies have been blamed for their role in America’s obesity epidemic. Insurers may also profit twice, because they have been able to charge higher rates to those who have overindulged in fast food and harmed their health–although healthcare reform will minimize that incentive, beginning in 2014.
Researchers at the Harvard Medical School believe that providers of individual, group, and family health insurance should use their clout as significant shareholders to push those chains to provide a wider selection of healthier products and offer smaller portion sizes.
