Health insurers saw net premiums grow across the board in 2007, according to a recent survey from SNL Financial.
Across the insurance industry, SNL reported that it was a highly profitable year for each insurance industry sector.
Overall assets for the health insurance industry increased by 5.9 percent, despite fourth quarter unrealized losses of $413 million. Net premiums were up more than 19 percent in Medicare and Medicaid lines, which SNL described as "an area of increasing growth despite commercial membership dominating the bulk of the business."
The managed care industry is under pressure from customers to restrain premium increases, SNL contends, while rising medical costs caused a 15 percent decline in underwriting gains, the second straight year of declines in the industry segment.
Commercial membership rose to 122.9 million in 2007, while non-commercial membership grew more than 10 percent to 25.6 million, compared with 23.2 million in 2006. Total membership in health insurance lines reached 148.5 million in 2007, compared with 144 million the previous year. Managed care membership grew by more than 4 million.
The increase in membership, combined with premium increases, contributed to an 8.3 percent growth in net premiums written in 2007, totaling $322.9 billion. The medical cost and claims expense ratio for the industry rose slightly, to 88.9 percent in 2007 from 88 percent the previous year. The expense ratio declined slightly, to 8.4 percent from 8.5 percent the previous year.
Underwriting gains declined 15 percent to $10 billion, from $11.8 billion the previous year.
Comprehensive medical premiums grew about 5 percent to $206.3 billion, up from $197.5 billion the previous year. Net Medicare and Medicaid premiums grew 19.4 percent, to $91.4 billion, from $76.6 billion the previous year.