Health Insurers, Are you Prepared for a Rainy Day?
Of course we know that what goes up must come down and health plans are now bracing for the latter after a good summer run.
The first bump in the road will be (it is hoped) an improving economy. As Americans begin spending more, they will inevitably return to things they cut out during the recession, such as that prescription for mild arthritis. There could even be a rather large swing the other direction as patients seek the treatments they've been putting off.
Of course, health plans will eventually benefit from favorable economic conditions, but that will set them up for what could be a pounding from healthcare reform and its many challenges including the new MLR mandates soon to be finalized.
These issues have not been overlooked by industry stock analysts who have begun what might be a string of pessimistic outlooks for insurers. As I write this, brokerage firm Stifel Nicolaus downgraded superstars UnitedHealth and WellPoint to "hold" from "buy," citing future regulatory pressures. And other insurance powerhouses Aetna and Cigna continue to sport a smattering of less than stellar investment opinions including neutral, hold and sell.
Insurers have made their peace with healthcare reform. While still trying to influence the finer points of the law, they realize that must play ball with the feds if they are to survive in the post-reform world.
According to industry analysts, their sights are now set on more routine activities including strategic critical infrastructure and capacity investments that will help them weather the influx of new customers under reform. Overseas markets are also high on many health plans' list.
p>Kudos on a good run, health plans. It's now time to mingle with the rest of us.
- 1 in 5 Eligible Hospitals Penalized for HACs
- 'Mega Boards' Could be Rural Healthcare Disruptor
- 12 Hires to Keep Your Hospital Out of Trouble
- Meaningful Use Payment Adjustments Begin
- HL20: Lee Aase—Who's Behind @MayoClinic
- No Boost to NFP Hospital Bond Ratings from Medicaid Expansion
- HL20: Peter Semczuk, DDS, MPH—Taking on the Big Challenges
- Ratcheting Up Patient Experience Has a Downside
- HL20: Rebecca Katz—Cooking Up Sustainable Nourishment
- Top 3 Nursing Lessons of 2014