Still, CEO Richard Barasch said his company, based in White Plains, N.Y., does have some advantages because health care is a local business.
"We are the largest Medicare HMO in Houston and in that market we have plenty of scale compared to the larger national companies," said Barasch. "We are the largest sponsor of ACOs (Accountable Care Organizations) throughout the country. It's a niche business and we've developed a nice spot in that business that enables us to compete with the larger carriers."
Universal American, whose stock is down 28% so far in 2015, is a Medicare Advantage company, which means that the government pays it a capitation rate for everyone who signs up with it to provide them coverage. The trade-off is that they are coming out of original Medicare coverage in order to get more benefits inside Medicare Advantage.
"What they give up is a little bit of flexibility on who they can go to. So we are private Medicare," said Barasch.
The company does not pay a dividend, but it has paid a series of special dividends. It has paid almost $20 per share worth of dividends to investors since 2011, according to Barasch.
Until 2004, Universal American's core business was long-term care, Medicare supplement and other supplemental insurance. In October it officially got out of the long-term care business.
"We stopped selling those products several years ago and now we had an opportunity to take them off our balance sheet, de-risk the company and focus all of our capital and attention to Medicare Advantage and Medicaid," said Barasch.
On the topic of health care inflation, Barasch said it's less pervasive than many Americans think. He said Medicare costs have moderated over the past several years in large part because many more providers are practicing through Medicare Advantage and some ACO programs.
"It's harder in the broader market because it is very opaque, but there is quite a bit more transparency coming to the system and I believe that will help bring costs down going forward," said Barasch.