Health Insurance Carriers
Companies in this industry underwrite health and medical insurance policies and administer group hospitalization plans, health maintenance organization (HMO), and preferred provider organization (PPO). Major companies include Aetna, Anthem Blue Cross and Blue Shield, Cigna, Humana, and UnitedHealthcare (all based in the US); as well as Aegon (the Netherlands); Allianz (Germany); and Bupa (UK).
Worldwide, demand for private health insurance is rising. Because of COVID-19, private health insurance demand in developing countries such as India and China experienced a sudden demand growth. Global healthcare spending reached $8.8 trillion in 2021, according to Pharmaceutical-Technology.
The US health insurance carriers industry includes about 5,400 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $860 billion.
Competitive Landscape
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 85% 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. People in the US covered by insurance totaled to more than 90% in 2020, according to Statista. Private health insurance coverage was more prevalent compared to public health coverage, covering about 60% and 40%, respectively, according to the Center for Disease Control and Prevention (CDC). The most common sub-type is employment-based insurance. Penalties for not having health coverage were 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 (PPO), point-of-service
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Sales & Marketing
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Finance & Regulation
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Regional & International Issues
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Human Resources
Also includes the following chapters:
Quarterly Industry Update
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Industry Indicators
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Business Challenges
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Trends and Opportunities
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Call Preparation Questions
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Financial Information
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Industry Forecast
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Industry Websites
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Glossary of Acronyms