Health Insurance Carriers
Companies in this industry underwrite health and medical insurance policies and administer group hospitalization plans, HMOs, and PPOs. Major companies include Aetna, Anthem, CIGNA, Humana, and UnitedHealth Group (all based in the US), as well as AEGON (the Netherlands), Allianz (Germany), and BUPA (UK).
Worldwide, demand for private health insurance is rising, especially in developing countries such as India and China, but also in countries with comprehensive government-provided health care. Private health insurance expenditures exceed $1.1 trillion annually, according to BCC Research.
The US health insurance carriers industry includes about 6,700 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $900 billion.
Demand for health insurance products is driven by cost of medical care. The profitability of individual companies depends on efficient operations and the ability to enter favorable contracts with health care providers. Large companies and organizations have advantages in negotiating contracts with providers. Small companies can compete successfully by specializing in types of coverage or populations. The US industry is concentrated: the 50 largest companies generate about 80% of revenue.
Health payment reform efforts have altered the competitive landscape for health insurance companies around the globe. The Affordable Care Act (ACA) mandated health care coverage availability for all Americans beginning in 2014; the law also eliminated some common exclusions, such as pre-existing conditions. Managed care companies compete for customers in new government-run health exchanges, where small companies and individuals can buy health care coverage. Many state Medicaid programs offer expanded coverage under ACA provisions. The proportion of people in the US covered by insurance rose from nearly 86.7% in 2013 to 91.2% in 2017 as millions of people gained coverage. Penalties for not having health coverage will be eliminated in 2019, but other components including individual marketplaces, Medicaid expansion, and consumer protections remain intact. The law also aims to tighten coverage and payment rates, including through reductions in Medicare and Medicaid reimbursements.
Products, Operations & Technology
Major products offered by US health insurance carriers include health maintenance organization (HMO), preferred provider organization (PPOs), point-of-service
Sales & Marketing
Finance & Regulation
Regional & International Issues
Also includes the following chapters:
Quarterly Industry Update
Trends and Opportunities
Call Preparation Questions
Glossary of Acronyms