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Another insurer blames health reform for layoffs

Assurant Health says the cuts will help "streamline its organizational structure" to prepare for changes in the insurance marketplace.

By Emily Berry — Posted Sept. 9, 2010

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Assurant Health has joined larger insurers in blaming health system reform for its decision to lay off 130 employees -- about 6% of its work force -- at its Milwaukee headquarters and office in Plymouth, Minn.

A company filing with the Securities and Exchange Commission on Aug. 19 said the layoffs are part of "efforts to reduce operating costs and to streamline its organizational structure in order to prepare for significant changes in the post-reform health insurance marketplace."

The announcement came a week after Assurant Health's parent company, Assurant, announced it would pay a 16-cent-per-share quarterly dividend to shareholders.

Speaking to investors and analysts during a conference call July 29, Assurant President and Chief Executive Officer Rob Pollock discussed how the company was preparing for that marketplace: "We've already filed new product offerings that will be available to both new and existing customers. We also know that modifications in how we operate will be necessary. We will need to lower the cost of doing business."

Assurant Health is the latest health insurer to cut staff and say it was done in response to reform.

In August 2009, before health system reform was adopted, Kaiser Permanente said cost-cutting required in advance of reform was behind its decision to eliminate 1,850 jobs, or 1.3% of its work force.

The same month, Health Care Service Corp, the parent company of Blues plans in Illinois, New Mexico, Oklahoma and Texas, cited reform as the reason for cutting about 650 positions, or 4% of its work force.

In November 2009, Hartford, Conn.-based Aetna announced it would eliminate as many as 1,250 jobs, about 3.5% of its work force, partially in anticipation of "the impact that health care reform and regulatory changes may have on its business," according to a filing with the Securities and Exchange Commission.

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