Insurance giant UnitedHealth Group announced Wednesday that the company posted record profits for the second quarter—doubling to more than $6.6 billion compared to the same period last year—as the coronavirus pandemic forced patients to cancel or put off elective healthcare or other treatments.
In a statement (pdf), the company attributed the "substantially higher than anticipated" earnings to "the unprecedented, temporary deferral of care in the company's risk-based businesses."
Larry Levitt, executive vice president for health policy at the Kaiser Family Foundation, summed up the financial news, tweeting, "The pandemic has been very good for insurance companies so far."
UnitedHealth Group, the parent company of Optum and UnitedHealthcare, revealed another data point which drew Levitt's attention.
"The second quarter medical care ratio was impacted by the temporary deferral of care due to the pandemic, declining to 70.2% from 83.1% last year," the company said.
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Adam Gaffney, president of Physicians for a National Health Program, put those figures in clear terms.
"Incredible—as hospitals are furloughing workers and cutting wages as budgets are squeezed, UnitedHealth's profits soar. *30%* of every dollar they got in premiums this quarter didn't go for healthcare—they kept it," Gaffney tweeted.
Incredible — as hospitals are furloughing workers and cutting wages as budgets are squeezed, UnitedHealth’s profits soar. *30%* of every dollar they got in premiums this quarter didn’t go for healthcare - they kept it. https://t.co/NXqOrwB5ES— Adam W Gaffney (@awgaffney) July 15, 2020
Levitt said that the "ACA requires insurers to give rebates to consumers and small businesses if the percent of premiums going to medical care drops below 80%. But, the rebates would not be provided until next fall and are calculated on a rolling three year basis," he added.
The new data follows UnitedHealth Group's earnings report for the first quarter of the year in which the company recorded a significant increase in profits. Those figures prompted former insurance executive turned Medicare for All advocate Wendell Potter to say that "while America's reeling from the Covid-19 crisis, my old industry—the private health insurance racket—is winning big."