Earlier this year, we released the Q1 2024 and Q4 2023 financials, highlighting the financial performance and earnings of major public insurance companies. This edition includes a comprehensive report on the reported statutory financial experience for health insurers for the full year 2023, medical loss ratio (MLR) rebate trends, Q1 2024 public companies’ financial statements, and a summary of recent health plan mergers and acquisitions (M&A) activity and valuation trends. Explore the key highlights below and download our newsletter for more details.
2023 statutory financials show changes across individual, group, Medicare, and Medicaid markets
Overall, pre-tax margins decreased 0.6% in 2023 to 1.7% across all lines of business. Loss ratios declined in individual comprehensive coverage, remained flat in the group market, and increased in Medicare and Medicaid compared to 2022.
2022 MLR rebate trends reveal lower rebates amid higher premiums
Our review of the MLR rebate public user files for the 2022 reporting year indicates higher premiums and slightly lower incurred claims in 2022, resulting in a lower current year MLR of 88.1%, down from 91.1% in 2021. MLR rebates paid in 2023 for the 2022 reporting year totaled $332 million, the lowest since 2018.
Q1 2024 financial performance shows decline in profit margins
Our review of large public companies’ profitability for their insured business shows that reported profit margins for Q1 2024 were, on average, 2% lower than Q1 2023 This decline was driven by UnitedHealthcare’s recognized $7.1 billion loss on the sale of its Brazil business. Most companies saw utilization in line with expectations.
Health plan market cap shows growth trends despite slower M&A
M&A activity has been slow over the past year, with the notable acquisition being HCSC’s purchase of Cigna’s Medicare Advantage block. Four of the seven tracked public healthcare companies reported gains in market capitalization in Q1 2024.
This newsletter is published with quarterly reports and full-year editions and is available for download. If you’d like to stay informed of our publications, please subscribe to our Pulse newsletter.
