Health insurance industry healthier than predicted

Tuesday, October 16, 2012 - 15:05 Chip Somodevilla/Getty Images Health and Human Services Secretary Kathleen Sebelius speaks about the recent Supreme Court decision to uphold the Affordable Care Act on July 11, 2012 in Washington, DC. So far, the fiscal impact of President Obama’s health care reform is not nearly as bad as originally forecast by Wall Street types. Parts of the Affordable Care Act have already taken effect, like the rule requiring insurers spend a certain percentage of their profits on medical costs -- some analysts had predicted that requirement would hurt the bottom line. “Investors overestimate the impact of the law on managed care organizations,” says Matt Choffina, a senior equity analyst at Morningstar. “They seem to be feeling little, if any, impact from the health reform law.” Consider UnitedHealth Group: On Tuesday, the company announced a 23 percent jump in third-quarter profits. With so many negative predictions, why is the health insurance industry so ...

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