Health Insurance Carriers

Health Insurance Carriers

Brief Excerpt from Industry Overview Chapter:

Companies in this industry underwrite health and medical insurance policies and administer group hospitalization plans, health maintenance organization (HMO), and preferred provider organization (PPO). Major companies include Aetna, Anthem Blue Cross and Blue Shield, Cigna, Humana, and UnitedHealthcare (all based in the US); as well as Aegon (the Netherlands); Allianz (Germany); and Bupa (UK).

COMPETITIVE LANDSCAPE

Demand for health insurance products is driven by cost of medical care. The profitability of individual companies depends on?efficient operations?and the ability to enter favorable contracts with health care providers. Large companies and organizations have advantages in negotiating contracts with providers.?Small companies?can compete successfully by specializing in types of coverage or populations. The US industry is highly concentrated: the 50 largest companies generate about 85% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Main revenue source of health insurance carriers includes health and medical insurance, which accounts for about 30% of the industry revenue. This is followed by group managed care medical plans (about 20%), individual medical service plans (about 15%), and supplemental Medicare insurance plans (about 15%).