Oregon’s Health Insurers Remained Financially Viable in 2010

A new report released by the Department of Consumer and Business Services found that these insurers averaged a 3 percent profit that year

March 2, 2012 -- An Oregon House committee heard the annual report on health insurance in an informational session earlier this week.

The report, issued in January by the Department of Consumer and Business Services (DCBS) contains information about how Oregon's seven largest health insurers are doing financially.

"This is our sixth such report,” Patrick Allen, director of DCBS, told the House Health Care Committee. “About a third of Oregonians get coverage from insurance companies regulated by us … which means small employers, large employers and individual policies.”

He pointed out some larger insurers are regulated by the federal government, including those who provide Medicare and Medicaid.

He also said about 17 percent of Oregonians have no health insurance.

“One of the highlights of this year's report is that many insurance companies reported lower medical claims' costs for this past year,” Allen said. “We think this is largely a function of economic conditions having an effect on utilization, having an effect on people's ability to pay co-pays, those kinds of things that would tend to drive down ability to pay for healthcare.”

Despite the economy, the state's seven largest health insurance companies remain financially viable in 2010.

“The seven largest insurers averaged a three percent profit,” Allen said. “Most of that came from investment income, rather than actual underwriting gain on healthcare provisions.”

The report says, as of mid-2011, a total of 89 cents of every premium dollar went to pay medical claims. About two cents of that same dollar went to profit, or net underwriting gain. Nine cents of that dollar went to operating costs.

The report also shows that Kaiser Foundation Health Plan of the Northwest and Regence BlueCross BlueShield of Oregon hold 49 percent of the state-regulated health insurance market.

Allen said his agency has begun holding public hearings on most rate requests and set up live streaming of those hearings. Web pages also explain the report and the data.

“This year, in addition to the full report, we have new web pages that highlight key financial data in consumer-friendly charts and graphs,” said Lou Savage, the acting administrator of the Insurance Division. “Consumers can find information on where Oregonians get insurance, premium trends, profitability of insurers and company-by-company data for our seven largest health insurers.”

The full “Health Insurance in Oregon” report is available on the division's home page, insurance.oregon.gov. Key data can be found by clicking on “financial data” at www.oregonhealthrates.org.

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