Analysis Suggests Health Insurers Remained Profitable Across Markets Amid Pandemic in 2020

A new analysis of health insurers' financials suggests they remained profitable across markets in 2020, partly due to an unprecedented fall in health spending and occupancy in the spring as the COVID-19 pandemic led to massive shutdowns.

The analysis examines insurers' 2020 data for four different markets: Medicare Advantage, Medicaid Managed Care, Individual (non-group) and Fully insured group (employers). In all four markets, insurers recorded higher gross margins per participant and month in 2020 than in the previous year. They ranged from an average of $ 188 for Medicare Advantage plans to an average of $ 71 for Medicaid Managed Care.

Similarly, insurers across the board reported paying out a lower percentage of the premiums they collected as claims in 2020 than they did in 2019. In general, lower medical claim ratios mean that insurers will after paying medical costs for use for Keeping administrative costs or more medical income as profit.

The impact of the pandemic on health spending and insurers' financial performance in 2021 remains uncertain. By the end of 2020, health care utilization has largely returned to pre-pandemic levels, and there could be additional pent-up demand for care that was missed or delayed in the past year.