Mark Farrah Associates Finds Diversification is Key Strategy for Health Plans

KENNEBUNK, Maine--(BUSINESS WIRE)--Leading U.S. health plans, that no longer see commercial medical membership as an option for substantial growth, are diversifying into health services businesses, looking for opportunities outside of the U.S. and pursuing other avenues beyond health insurance for the long term, according to a new report released by Mark Farrah Associates (MFA). Total membership for the seven leading U.S. health insurance carriers increased from 125.0 million in 2009 to 125.9 million for 2010. The net membership gain of 0.7% from 2009 to 2010 compares to an increase of 0.3% from 2008 to 2009. While leading health plans saw overall gains, Commercial medical enrollment continued to decline for these carriers, falling -0.7% from 2009 to 2010.

UnitedHealthcare added 420,000 Medicaid; 370,000 Medicare and 185,000 Commercial members, with growth rates of 14.5%, 8.3% and 0.7%, respectively from 2009 to 2010. UnitedHealth's business model is focused on two platforms, benefits and services, and further diversification of its enterprise is expected. Aetna and CIGNA espoused strategies to grow beyond being leading U.S. health plans to becoming global leaders in healthcare. Aetna's Commercial enrollment fell by 611,000 members from 2009 to 2010. CIGNA, which adopted a more global strategy earlier in 2010, reported an increase of 304,000 Commercial members during the same time period. Humana's diversification strategy has primarily focused on the military and senior markets. With the acquisition of Concentra, and its medical centers and workplace clinics, Humana appears to be returning to its roots as a provider of health care. During 2010 Humana's commercial enrollment fell from 3.3 million to 3.1 million.

In the latest Healthcare Business Strategy report MFA's reviewed enrollment and financial trends among seven top health insurers: Aetna, CIGNA, Health Care Service Corporation (HCSC), Humana, Kaiser Permanente, UnitedHealth Group and WellPoint. It looks at full-year results from 2009 to 2010. Financial and membership data and observations were gleaned from the April 2011 Health Insurer Insights™ series.

MFA is a leading data aggregator and publisher providing health plan market data and analysis tools for the healthcare industry. Committed to simplifying analysis of health insurance business, our products include Medicare Business Online™, Medicare Benefits Analyzer™, Health Coverage Portal™, Health Insurer Insights™ and Health Plans USA™.

Contacts:
Mark Farrah Associates
Debra Donahue, 207-985-8484