Below are some highlights from KPMG’s 2010 Managed Care Industry Report:
- In 2009, the largest health insurers in the U.S had combined profits of US$14.4 billion, an increase of 56 percent over 2008, even though the industry lost 2.7 million members who had health insurance the year before.
- However, these companies are not expected to repeat their performance in 2010. The expected high unemployment rate in 2010 may further erode insurers’ highest margin and commercial membership, which declined by 2.3 percent among publicly traded insurers in 2009.
- The U.S. health insurance market is expected to grow 7 percent annually from 2009 to 2011. However, with the implementation of reform, health insurers will face pressure to maintain profitability. Expect to see premium increases, job cuts, administrative cost reductions, and increased M&A activity.