WellPoint, Cigna Balance Medical Bills, Profits

NEW YORK (TheStreet) -- As President Barack Obama's health-care plan gets a renewed focus, insurers' expenditures on customers' medical bills and their own earnings have become front and center of the debate. According to a Street.com review, almost two dozen large insurers succeed in balancing high health-care spending and making a profit.

A U.S. House of Representatives subcommittee yesterday started a hearing on premium increases by WellPoint(WLP) subsidiary Anthem Blue Cross. The company claims that, following the loss of some healthy policyholders, it's left with a more sickly and expensive group of customers. That means it's lost money.

Nineteen of 587 insurers spend more than 87.9% of their premium income, the average among the industry, on medical expenses and turn a profit while returning more than the average 2.4% in income, figures through September show.

WellPoint subsidiary Empire HealthChoice Assurance of New York leads the way for WellPoint in displaying how it can be done. The insurer, rated "A" for financial strength by TheStreet.com Ratings, spent 89.7% of its premiums on medical expenses and still returned an above-average 2.6% net income, including $36 million in investment income.

WellPoint isn't alone. Cigna(CI) subsidiary Cigna HealthCare of Arizona spent 90.2% of its premiums on medical expenses. It returned 3.4% in net income. Humana(HUM) subsidiary Humana Health Plan of Puerto Rico spent 89.5% and booked 3.2% net income.

Aetna(AET) subsidiary Aetna Health of California spent 88.5% of its premium income on medical expenses and returned 2.5%. And California-based Health Net(HNT) subsidiary Health Net of Arizona spent 87.9% and made 2.5%.