Posts Tagged ‘United Healthcare Illinois market share’

Blue Cross still dominates Illinois market, UnitedHealthcare closes in

July 19th, 2012 by admin | No Comments | Filed in Blue Cross Blue Shield of Illinois, United Healthcare

(Crain’s) — Blue Cross & Blue Shield of Illinois maintained a commanding slice of the state’s health insurance market in 2011, but a key competitor is chipping away at the carrier’s lead, according to insurance regulatory data.

With 10.24 percent of the $21.1 billion Illinois market in accident and health insurance, UnitedHealthcare of Illinois is still a distant second to Blue Cross’ 48.13 percent, but few carriers have matched the company’s growth in recent years.

UnitedHealthcare’s direct premiums in Illinois totaled about $2.2 billion in 2011, up 30 percent over 2009, when receipts were only $1.7 billion and its market share was 8.28 percent, according to an annual report by the National Association of Insurance Commissioners. Meanwhile, Blue Cross’ premium revenue rose to $10.2 billion, up 14 percent from two years before. Market share for Blue Cross remained nearly flat from 2010 to 2011.

Experts say UnitedHealthcare’s growth is due in part to its aggressive courting of employers desperate to reduce benefits costs and looking for Blue Cross alternatives. Due to its strong market position, Blue Cross still commands the deepest discounts on premiums. UnitedHealthcare compensates by offering more flexibility in plan design, particularly in initiatives such as wellness and education programs.

“I think employers are seeing that you can get savings and increase the effectiveness of the benefits plan if the employees understand it,” said Dale Moyer, a principal at Benefits & Compensation Resources LLC, a Deerfield-based employee benefits consultancy. “From an employer’s perspective, I think (UnitedHealthcare) has an edge.”

UnitedHealthcare sees itself as a local company that can take advantage of the resources of its national parent, Minnetonka, Minn.-based UnitedHealth Group, to customize plans for members.

“We believe there is a need for a breadth of products and solutions for employer and individual,” said UnitedHealthcare’s President and CEO Tom Wiffler. “We’ve been very aggressive about trying to push a variety of products to synchronize with the needs of the market.”

The NAIC figures include only the carriers’ business in fully-insured plans, not revenues received as part of their administrative services-only contracts with self-insured plans.

About a third of the UnitedHealthcare’s 1.2 million members in the state — or about 400,000 people — are in fully insured plans. That was still about a quarter of Blue Cross’ 1.7 million fully insured members.

Nonetheless, higher membership means more leverage for insurers in negotiations with providers. UnitedHealthcare in March inked a three-year deal with Rush System for Health that gives access to 1.1 million members to Rush University Medical Center, the 304-bed hospital that opened on Chicago’s Near West Side in January, and Rush Health’s nearly 800 physicians. Rush had been the only large Chicago-area health system that didn’t have a contract with UnitedHealthcare.

Though UnitedHealthcare runs second in Illinois, UnitedHealth Group tops the $700 billion national accident and health insurance market, with $84 billion in direct revenues and about 12 percent market share. Chicago-based Health Care Service Corp., Blue Cross’ parent and the operator of Blues plans in Texas, Oklahoma and New Mexico, came in sixth, with $20.9 billion in premiums and 3 percent of the market.

In a statement, a Blue Cross spokeswoman said the insurer “supports a competitive marketplace for health insurance. Despite the strong local and national competition we face, our members consistently choose Blue Cross and Blue Shield because of our product selection, extensive provider networks, excellent customer service and commitment to help them manage their health care choices and decision.”

Rounding out the top five in the state’s accident and health insurance market were three other health insurers: Louisville, Ky.,-based Humana Group; Health Alliance Medical Plans in Urbana, and Hartford, Conn.-based Aetna Group.

From 2009 to 2011, Health Alliance saw its premiums increase 10 percent to $1.1 billion, and its market share rise to about 5 percent, from 4.75 percent. The carrier has about 320,000 members. In an interview, Health Alliance CEO Jeff Ingrum attributed the performance to strong growth in its individual and Medicare Advantage plans.

Humana’s market share rose to 8.36 percent in 2011 on $1.77 billion in premium revenue. A spokeswoman did not provide comment. Aetna brought in $767 million in premium revenue in 2011 for a 3.63 percent share of the accident and health insurance market.

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