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【出版时间及名称】：2010年5月美国管理医疗行业研究报告
【作者】：摩根大通
【文件格式】：pdf
【页数】：505
【目录或简介】：
Our comprehensive Stat Check analysis shows the deep details of what has been
going on broadly in the health insurance industry over the past year. The bottomline
is that commercial margins have deteriorated to levels not seen in many years,
with the not-for-profit sector now literally just that. In more normal times
however, these factors would not incite despair at all, but instead a view that it
shouldn’t get worse and indeed, much more likely improve in the out years.
After-all, it isn't a sustainable insurance business model even for non-profits to run
at break-even over a period of years. The cycle…at least that's what it used to be
all about. Of course, we've got other things on our minds right now,
predominantly assessing reform impact. As a result, with this Stat Check, in
addition to our regular sector-wide deep dive, we also include further insights into
that nearest-term reform event: the implementation of minimum MCRs. Stat
Check incorporates over 500 filings from 25 of the largest health plans, both forprofit
and not-for-profit/mutuals; these entities provide health benefits to about
two-thirds of the U.S. market.
• Margin deterioration, of course, has been evident, but then we already
knew that. The full group now runs an 87% commercial MCR, with the forprofits
at 85% and not-for-profits at 88%. The commercial MCR is up 100bps
over last year, this over the already elevated 2008 comps and the highest we
have seen in many years. The non-profit component, about 45% of the
market, is running break-even underwriting margins, this is compared to 4-5%
about five years ago.
• Yields never got the boost in ’09, while ’10 indications are better, and
attrition high. Commercial premium yields edged down modestly last year,
running just over 5%, this compared to over 9% in 2004. Commercial-insured
member attrition was, of course, record breaking, at nearly 4 millions lives for
the companies we include, double last year. More recently, the latest quarterly
reports though have shown signs of easing attrition metrics, as well as better
yield performance.
• So what about those MCR minimums? In this report, utilizing full year
2009 statutory data, we show how we have assessed the impact of the MCR
minimums, which is already reflected in our 2011 earnings estimates. We also
show how the non-profits are performing against these minimums. Of course,
there's some judgment here, as the rules aren't even out yet; so, we incorporate
our current view as to how these will ultimately be configured. We assess the
earnings impact of potential refunds as ranging from 2% to 8%. In the end,
while certainly notable, it is probably less than some fear and, we believe
mostly a 2011 event, as we believe distribution costs – the main hurdle to
meeting the minimums - will be significantly reconfigured for 2012
We include below some company-specific observations, with more detail and
companies within this report.
• Aetna – With the small group book already performing poorly, at an 84% loss
ratio, it’s mostly about individual, with 90% of premiums falling below the
minimum, and we estimate total impact at about $55mm pre-tax. With a
dominant legal entity which writes 50% of total premium revenues, the entitylevel
assessment we use is probably more favorable than a state-based
assessment.
• CIGNA – The company is the least affected in our group, at about $40mm pretax.
Notably, we believe that we may be picking up some books of business that
would not be subject to the minimums and as a result, we believe likely a more
modest impact. Also with a dominant legal entity (writes 60% of premiums),
there is a bias likely favoring entity versus state-level assessment.
• Coventry – The largest implied exposure as a percent of earnings (about $40mm
pre-tax) with the very small, but low MCR individual book contributing
disproportionately. With the related high distribution costs and, if these are not
readily altered, then exiting this book might create less of a drag.
• Humana – While we usually just think about Senior business, nearly all of the
individual book falls below the 80% threshold while 60% of the small group
book does also. We assess an $80mm pre-tax impact, though frankly here we
also question that given the current distribution costs, it may also make sense to
exit some markets and potentially lighten the impact, though we expect these to
fall significantly in the out years.
• UnitedHealth – The company has the second-largest implied dollar impact at
just over $300mm, while given the diversity of segments, this is less as a
percentage of earnings than some others. For UNH, it’s the individual segment
and in particular the Golden Rule entity with a 63% loss ratio, that drives a
disproportionate amount of the company-wide impact.
• WellPoint – We estimate about at $330mm, the highest dollar impact in the
group, somewhat evenly distributed between individual and small group.
Notably, with the limited CA disclosures, we have to estimate more for WLP.
Also as noted, we make our assessments for the companies at an entity level,
while we believe a state-based assessment might result in a more modest impact
for WLP.
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