Remember how that ’socialist’ President Obama took over the health insurance industry? Remember how the new health care law was a ‘government takeover’ of one of the largest segments of the U.S. economy?
Well, that socialized, government takeover has worked out pretty well for the big for-profit health insurance companies. They are enjoying soaring profits, and their executives received hefty compensation packages last year. After the health care law passed, Aetna’s net income jumped 40 percent over the same period last year. From the LA Times :
The top executives at the nation’s five largest for-profit health insurance companies pulled in nearly $200 million in compensation last year — while their businesses prepared to hit ratepayers with double-digit premium increases, according to a new analysis conducted by healthcare activists.
The leaders of Cigna Corp., Humana Inc., UnitedHealth Group and WellPoint Inc. each in effect received raises in 2009, the report concluded, based on an analysis of company reports filed with the Security and Exchange Commission. . .
“Most families are struggling to hang on. Employers are struggling to stay in business. And these guys were giving themselves huge raises,” said Ethan Rome, executive director of Health Care for America Now, a coalition of advocacy groups that prepared the report.
A spokeswoman for WellPoint said executives’ compensation reflects their effort to improve care and hit corporate goals. Representatives of the other four insurers either declined to comment Tuesday on the report or did not respond to questions.
The executive packages were calculated by adding base salaries, bonuses, stock awards and other compensation reported on company financial statements. It did not include the value of exercised stock options.
Last year was highly profitable for most of the country’s big publicly traded insurers. In the first two quarters of this year, profits for many insurers have continued to soar more than 20%.
Aetna’s net income jumped more than 40% in the second quarter of 2010 compared with a year earlier. Indianapolis-based WellPoint recorded a 51% increase in its profit in the first quarter compared with the same period in 2009.
At the same time, the companies have sought major premium hikes. In Rhode Island, UnitedHealth of Minnetonka, Minn., this spring sought increases of up to 15.5%. In Utah, some customers of Humana of Louisville, Ky., reported increases of 29%.
Health insurance companies and their Republican defenders continue to claim that health care reform has caused health insurance premiums to rise. That’s nonsense, of course. As the report makes clear, premiums were rising before the law passed. They’d been rising for the last decade. In fact, outrageous increases in premiums helped to shore up sagging support for the reform among Democrats in Congress.