Some initial comments from health plan executives suggest 2010 is going to be a challenging year. Here’s what executives from Aetna, Humana, UnitedHealth and WellPoint had to say in announcing third quarter financial results.
Ron Williams, chairman, Aetna: “We view 2010 as a repositioning year, a year that does not fully reflect the earnings potential of our business.”
Stephen Hemsley, chief executive, UnitedHealth Group: “We expect 2010 to be a somewhat more difficult year than 2009. The loss of commercial risk business over the course of 2009 creates headwind on margin dollars for UnitedHealthcare and OptumHealth for 2010. And H1N1 flu will remain a risk.”
Wayne DeVeydt, CFO, WellPoint: “We foresee a number of headwinds and tailwinds impacting next year such as the economy – including its impact on commercial number of months – expectations for an elevated flu season that will likely carry into the first quarter of 2010, high levels of COBRA membership, higher than anticipated reserve releases in 2009 that are not expected to recur in 2010, and Medicare Advantage reimbursement cuts, these being offset by…operational efficiency initiatives and the sale of NextRx.”
Michael McCallister, chief executive, Humana: “We target an overall Medicare pretax operating margin of approximately 5 percent, which next year will include a significant increase in group membership, a traditionally lower margin business, a moderating margin for our stand-alone PDPs, and an individual Medicare margin that approximates the overall target.”
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