Friday, January 09, 2015

Results Are In And It Isn't Pretty

Early Obamacare results from the carrier side are looking ugly. An Assurant financial statement is revealing for the first 9 months of 2014.

A 3rd quarter loss of $17M might not seem like much but you have to factor in a couple of things.

Assurant is a relatively small player in the individual health insurance market. The $17M loss contrasts with a $6M net operating gain for the same period a year earlier.

Then there is this ..........

Net operating loss in third quarter 2014 was driven by increased claims from Affordable Care Act (ACA) qualified policies. Results reflect estimated recoveries from the ACA riskmitigation programs.
Note: In 2014, ACA risk-mitigation programs designed to reduce the potential adverse impact to individual health insurers from health care reform provisions went into effect. Assurant Health is eligible to participate in the risk-adjustment and reinsurance programs. As of Sept. 30, 2014, estimated recoveries under these two programs totaled $257 million. 
If not for the "taxpayer bailout" the losses would have exceeded $274 million.

I think Assurant and the other carriers should send us a thank you note.

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