Uncertain future: Financial losses could impact hundreds of Assurant Health employees

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MILWAUKEE (WITI) -- Some 1,200 Employees of the Milwaukee-based Assurant Health are facing an uncertain future. That's because this week, Assurant's parent company announced plans to either sell the business or just close up shop.

"They've been signalling in the last year or two that they're definitely having some challenges," said Rich Kirchen of the Milwaukee Business Journal. "They've been losing money. The company has not fared well as the affordable care act has rolled out."

In a statement on Assurant Health's parent company website, it said the following:

"The company expects Assurant Health to report a net operating loss for the quarter in the range of $80 million to $90 million. APproximately half of the loss is attributable to a reduction in 2014 estimated recoveries from the Affordable Care Act (ACA) risk mitigation programs. The remainder reflects elevated claims on 2015 ACA policies."

"A lot of people who lost their insurance or didn't get insurance on the exchange signed up for Assurant products. And a lot of those people were not, it was a sicker population. It was a higher risk population and the company lost money on that," said Kirchen.

The big question is -- what does all of this mean for Assurant Health's Milwaukee employees? FOX6 News was told it is premature to speculate on an outcome. But if the company is sold, Kirchen says their status will depend on who the buyer is.

"If it's another insurance company, they might want to keep all or part of the operation in Milwaukee. If it's just an investor group that buys it, they might have their own ideas. They might want to cut costs and cut jobs here," said Kirchen.

Assurant Health's parent company says it a buyer cannot be found, the company plans to get out of the health insurance market in 2016.

3 comments

  • Reasonless

    Thank you Mr. Obama for fixing health care.
    Just another example of you putting you nose into things that you don’t have the intellect to understand.
    You are a small child playing with our money and our future.
    Fool.

    • BADDAY

      He knew exactly what he was doing. The main purpose of the Affordable Care Act was not to make health insurance affordable, but to make it impossible for companies like Assurant Health to do business. The end of companies like Assurant Health puts that much closer to the real goal of the ACA which is 100% government-run health care.

  • Opinion8d

    The basis of insurance companies is pooling risk and pricing that risk correctly. They don’t care if they are healthy or sick, or have health histories as long as they can price appropriately for future claims. Automatically covering kids under 26 on family health plans without being able to charge more, as well as not declining coverage to those with pre-existing conditions is extremely expensive. I hope they find a sustainable solution for the employees and their families sake.

    And doing well for their shareholders is all part of how companies work -they are also providing jobs for 1,200 people who could now be a risk of losing that. On top of that, the City of Milwaukee and State of WI could lose a large amount of tax dollars – A LOT!!! The economic impact from is tremendous from this ‘big, bad’ companies.

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