U.S. health insurers that waged a campaign against Obamacare hit an all-time high on the stock market Wednesday after UnitedHealth Group Inc. said it would add hundreds of thousands of new customers because of the law.
The Standard & Poor’s 500 Managed Health Care Index -- which includes the five biggest U.S. insurers -- closed at 1,031.18 on Wednesday in New York, the highest level since at least 1994. Health insurers have said that the Affordable Care Act has cost them billions in taxes and fees -- including $1 billion in 2014 for UnitedHealth -- and burdened them with new regulations.
The Affordable Care Act requires all Americans to have health insurance. To do so, it created marketplaces for people to buy coverage, often with subsidies, and expanded Medicaid, the joint federal-state program for the poor.
That’s meant millions of new customers.
“We got something like 15 to 16 million people through those two channels, and about 10 million people were previously uninsured,” said Ana Gupte, an analyst at Leerink Partners. “That’s new growth that this industry never experienced before.”
The industry was one of the law’s biggest opponents. While health insurers have worked with Democrats on the law’s implementation since its 2010 signing, in 2009 they secretly funneled $86.2 million to the U.S. Chamber of Commerce to fund a political campaign to oppose the law. Since then, the industry has publicly said it supports the law and wants implementation to be successful.
“Consumers and health plans are still in the early stages of transitioning to an entirely different marketplace,’’ Clare Krusing, a spokeswoman for industry group America’s Health Insurance Plans, said in an e-mail. “We’re entering uncharted waters, even more so over the next several months. In light of all of these changes and uncertainty, our focus is on ensuring an affordable and stable market for consumers.”
After reporting results Wednesday, UnitedHealth reached its highest price ever, closing at $109.32. Chief Executive Officer Stephen Hemsley said the company had increased revenue and profit “despite material and well-documented burdens from the” Affordable Care Act.
UnitedHealth shares have more than tripled since April 2010, the month after the law was passed, compared with a 72 percent gain in S&P 500. Aetna Inc., Anthem Inc., Humana Inc. and Cigna Corp. all also hit record highs Wednesday. Together, the companies make up the biggest for-profit insurance providers in the industry.
The Department of Health and Human Services said Wednesday that 7.1 million people have used U.S.-run marketplaces in 37 states.
“The ACA took steps to reduce the number of uninsured in this country; that’s a good thing,” said Cynthia Michener, an Aetna spokeswoman. “But we have a lot more work to do to improve quality and cost.”
Spokesmen for other insurers on the index either didn’t immediately respond to requests for comment, declined to comment, or referred to previous statements supporting the law.