Profits for Health Insurers Now Depend on Risk Management

Profits for Health Insurers Now Depend on Risk Management

Multimedia from this Release

Monday, March 3, 2014 - 5:00pm


CONTENT: Multimedia with summary

Health insurers are now calculating their profits based on risk management instead of risk selection. Under the Affordable Care Act, insurers can no longer turn down potential enrollees for pre-existing conditions, and can not charge more to those who have health problems. That means for the insurers to make money, they will have to push down the cost of covering their less-healthy customers. To manage these costs, health plans now need to know the health status of those signing up for coverage so they can project costs in relation to the premiums charged for that coverage.

So now, insurers are contacting new enrollees, using health-risk assessment forms to collect detailed information about their conditions, prescriptions and personal habits that affect health, such as diet, exercise, and whether or not they smoke.  At some insurers, outreach calls encourage enrollees to get tests for cholesterol and blood sugar. Others are setting up appointments with physicians for those enrollees without a regular doctor. These new practices are key to achieving the twin goals of the ACA: a more fully insured and healthier population, and a profitable business model for those underwriting it. 

I’m John Howell for 3BL Media.

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