Underwriting Changes

[InsureGuy5]

Has anyone noticed that health insurance underwriting has become more strict since all of the health care reform issues bubbled to the surface. It seems to me that more clients are being turned away than one would normally suspect. Thoughts?

 

[somarco]

I am having a helluva time getting stuff through underwriting. It is across the board, no one carrier is any worse than the others.

Even Humana, who used to approve policies in 20 minutes, is now ordering an APS over a hangnail and looking for ways to decline coverage.

 

[Crabcake Johnny]

Can confirm; members left and right and emailing and calling me about horrible placement rates. Agent who used to get 90% of their apps through are suddenly getting 50% through.

 

[moonlightandmargaritas]

Has anyone noticed that health insurance underwriting has become more strict since all of the health care reform issues bubbled to the surface.

I think the timing with the hoopla over health care "reform" is coincidental.

It has more to do with profitability.

Some companies with large group blocks (Humana, UHC, etc.) are having profitability issues (bad economy, less folks on group insurance) in that space and looking for ways to make up for lost profits. Even saw some skinny that Humana may sell their group business to Aetna and be done with it.

Quickest way to boost profits is to lower the loss ratio, ergo tighter u/w. Works for P&C lines too.

 

[Crabcake Johnny]

I linked the Anthem article on the other thread. As Anthem explains, in these economic times healthy people drop coverage leaving the sick on the plans.

When that happens rates go up but also the carriers cannot risk taking on any more adverse selection and need to clamp down to make sure they're not buying a claim.

 

[Rivers1]

I concur, underwriting has tightened up considerably.

Rate-ups, riders, declines oh my!