Strongest & Weakest Health Insurance Companies

JUPITER, FL, Jul 22 (MARKET WIRE) —  The new Patient Protection and Affordable Care Act is expected to squeeze the profits and finances of the nation’s smaller health insurers, forcing many to withdraw from the market, be acquired, or fail. However, most of the nation’s largest insurers have the capital and efficiencies needed to handle the expanded coverage and buy out the smaller companies, according to a new study by Weiss Ratings, the nation’s only provider of independent insurance company ratings. “Sweeping changes mandated by health care reform, such as the removal of certain limits and mandated coverage for pre-existing conditions, will inevitably force health insurers to spend more on medical care,” commented Martin D. Weiss, president of Weiss Ratings. “Most large health insurers will be able to handle it. But we are concerned that weaker, less profitable insurers will be forced out of the market, reducing competition and ultimately leading to fewer choices and higher premiums for consumers.”

The Weiss Ratings study covers 585 of the nation’s health insurers, including 353 companies that already meet the mandated requirement going into effect next year to pay out at least 85% of their premium dollars in medical expenses.

Among the 585 companies, 95, or 16.2%, received a Weiss Rating of D+ (weak) or lower, putting them at risk of future financial difficulties caused by higher medical costs, a weaker economy or other pressures. In addition, another 186, or 31.8% of the industry, are rated C+, C or C- (fair), many of which could also have some difficulty absorbing the additional costs mandated by health care reform.

Weiss added: “Smaller insurers with less capital and fewer efficiencies of scale are more likely to suffer difficulties or even go out of business due to health care reform. Already, even before any additional expenses mandated by health care reform, 174 health insurers reported losses last year. In contrast, the largest, most efficient insurers with abundant capital and solid profits are not only in a position to absorb the higher expenses mandated by reform but could also expand their market share by buying up the weaker companies.” 

Among the nation’s 16 largest health insurers, controlling 45.7% of the industry’s assets, the nation’s largest health insurer, Kaiser Foundation Health Plan Inc. with $37.8 billion in assets merited a Weiss rating of A- (excellent), while the second largest, Health Care Service Corp., with $11.4 billion in assets, was rated A+. Also receiving excellent grades were Blue Cross Blue Shield of NC (A+), Blue Cross Blue Shield of SC (A-), Blue Cross of California (A+), California Physicians’ Service (A), Community Insurance Co (A-) plus two New York companies — Empire HealthChoice Assurance (A-) and Excellus Health Plan (A+). None of the 16 largest were in the weak (D+ or lower) or fair (C, C+, C-) category. 

To help consumers avoid the weakest health insurers and find the strongest licensed to do business in their state, Weiss Ratings has released its lists of the 118 strongest and 100 weakest health insurance companies. Consumers can immediately receive both lists at no charge by providing their email address at