The algorithms once again, complicated and complex lead to a record year in profits as the recession for the rest of us continues on. What is also interesting is the lower amounts that have been algorithmitized to only spend as low as 73% of policy money on individual plans. This leaves extra money around to invest in wellness programs that taunt biometric monitoring and study your behavior, such as the example below, and Red Brick also happens to be a client of Ingenix, a subsidiary of United Health care. All these folks seem to be wrapped up all around each other in one way or another.
All the insurers keep complaining about membership drops, but that doesn’t seem to affect the profits at all. BD
Like the rest of Wall Street, WellPoint – one of the nation’s largest insurers, with 14 state Blue Cross brands in its portfolio – is having a banner year.
Today, WellPoint announced that profits jumped 727%. In the middle of the biggest recession in generations, WellPoint is raking in the cash hand-over-fist. Why the jump? Turns out, last year WellPoint spent even less on actual health care than it did in 2008.
In 2008, it spent 83.6% of the premiums it took in on care – paying for doctors, drugs, and the like. In 2009, they spent only 82.6% of your money on your care. That seemingly small difference actually belies bigger discrepancies. An analysis by the Senate Commerce Committee [pdf] found that while WellPoint spends about 85% of every premium dollar on care in the large group market that big businesses can tap into, they spend as low as 73% of every dollar collected through individual plans, and 79% on small group plans purchased by small businesses.
Martin L. Miller, a Senior Vice President at WellPoint, said that lowering the amount of money WellPoint spends on health care "really is the driver of profitability" and that the lowering of this percentage "is really what’s driving our improved financial results this year."
They spent $4.7 million of it – $4.7 million of your dollars – on lobbying, a 21% increase from last year. And they secretly funneled more than $1 million to the Chamber of Commerce to run misleading attack ads trying to kill health reform. Oh, and CEO Angela Braley – the woman who said that her company wasn’t interested in expanding coverage if it meant making less money – made $8.7 million.