Wednesday was a difficult day for The American Independent News Network, which is the larger entity that operates The Iowa Independent. Our chief executive and founder announced two of our sister sites would close and their content would be moved to The American Independent.
A recently introduced bill could have far-reaching impact on the U.S. sugar industry, including American Crystal Sugar, a farmer-owned cooperative that locked out 1,300 Midwest workers on Aug. 1.
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The Iowa Senate will remain under the control of a slim 26-25 Democratic majority when it reconvenes in January 2012.
The Des Moines-based Principal Financial Group announced Thursday that will exit the medical insurance business, allowing UnitedHealthcare the option to renew existing coverage for its customers.
Larry D. Zimpleman, chief executive of Principal Financial, released a statement indicating that the decision had been a difficult, but correct one for the company.
“While performing well financially, our medical business has been declining in relative size for a number of years, thanks to strong growth from our retirement and asset management businesses,” said Zimpleman. “The medical business continues to be one that undergoes rapid change, which would mean investing additional capital into the business to be able to offer competitive products. For us, that just does not make sense.”
Reporter Avery Johnson of The Wall Street Journal speculates that the move is “an early sign of expected consolidation as the impact of the health overhaul becomes clear.”
The federal health overhaul passed in March has prompted worries among regulators and industry groups that smaller insurers might have difficulty competing under rules that require insurers pay out between 80 percent and 85 percent of premiums on medical care.
A draft of those rules issued last week contained some measures, such as not allowing fraud programs to count as a medical expense, that could curb insurers’ profitability. Final regulations are expected within the coming months. …
The Obama administration hopes that health-insurance exchanges that start in 2014 will allow competition to flourish. “Having 30 million new people, many with tax credits to buy health insurance, is going to spur new entrants,” said Nancy-Ann DeParle, head of the White House Office of Health Reform.
Sales of the Principal Financial product will cease immediately and renewals with UnitedHealthcare are scheduled to be fully completed within 36 months, depending on federal and state requirements. As the business is transferred, the company expects to eliminate several hundred employees, but hopes to move as many individuals as possible into other roles within the company. Initially, roughly 150 of the 1,500 employees impacted are expected to be eliminated.
The company will continue to offer life, dental, vision and disability plans. Existing wellness programs and health savings accounts are also not expected to be impacted by the change.
The company does expect the decision to negatively impact its third quarter results. Details of the deal between Principal Financial and UnitedHealthcare were not disclosed.
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