Health Insurance acts as reason to smile. Uncertain injury & sickness can steal your smile. But this time, the Health Insurers are in dilemma whether to smile or not. They have to think about mergers & acquisition with insurance companies.
Why mega-mergers become need of the day?
Recently, the Affordable Care Act was reaffirmed by the Supreme Court. It has compelled many health insurers to go for mergers for releasing tension of financial pressure from their head.
Unlike Business Insurance & its companies, it’s unlikely that merger & acquisition of two insurance companies would be held, as per analysts. Such acquisition will cut off competition for health insurance customers. The pricing would become the puppet of insurers’ hands. They would be in power to fix the price of the policy as per their wish.
What will be the effect of the merger?
If foretold will happen for sure then the number of national health insurers will shrink from five to three. The only three companies will run like lonely survivors yet ultimate warriors. These are Anthem, Aetna & UnitedHealth Group.
It is already a strict direction for insurance companies to consolidate under OBAMACARE. Maximum to maximum people are making purchase of Health Insurance just because of Obamacare. Commoners see it as a lucrative deal to bank on just as an industrialist does via Workers Comp Insurance, General Liability Insurance, Business Owners Policy (BOP) & Professional Liability Insurance.
Why health insurance is at boom?
People have gone more aware. They catch intensive & thorough look into who the health provider is. Just due to strict direction from Supreme Court, merger is seen in every section of health, for instance between hospitals, doctors’ group, hospitals to acquire bigger doctor’s group.
If seen from the eyes of a merged company, the profit making would be hard nut. The complicated rules of Obamacare will not let them make out good profit. But categorizing more client services as ‘health care expenditure’ can help them to do so.
Afterwards, the insurers will be in dominance to negotiate what gets them more & more financial benefit.
