"The Resilience of the U.S. Economy and the Success of Insurers: A Path to Soft Landing"

Ben H.

Hatched by Ben H.

Aug 23, 2023

3 min read


"The Resilience of the U.S. Economy and the Success of Insurers: A Path to Soft Landing"


In the face of economic uncertainty and the need to combat inflation, the U.S. economy has demonstrated its ability to achieve a soft landing. This is evident in various sectors, including business hiring, where companies are prioritizing the retention of workers rather than resorting to layoffs. Additionally, the first quarter of 2023 has seen publicly traded health insurance companies thriving, with notable increases in net income and revenue. This article explores how the U.S. economy is navigating a measured slowdown while highlighting the success of insurers during this period.

The Importance of Retaining Workers:

Unlike previous economic downturns, the current focus on worker retention is a significant departure from the conventional wisdom of layoffs during uncertain times. Despite predictions of layoffs due to inflation and high interest rates, companies like Apple are actively avoiding such measures. This approach not only prevents a downward spiral of reduced consumer spending but also maintains stability within the economy. By placing a priority on keeping workers, businesses are contributing to a soft landing.

Insurers' Profitable First Quarter:

The first quarter of 2023 has proven to be prosperous for publicly traded health insurance companies. UnitedHealth Group, the industry leader, experienced a 16% increase in net income to $8.1 billion, with revenue rising by 15% to $91.9 billion. UnitedHealthcare, the company's insurance arm, saw a 14% rise in net income to $4.3 billion, driven by higher Medicare Advantage and exchange membership. Optum, the healthcare services subsidiary, also reported significant growth, with net income rising 19% to $2.7 billion and revenue increasing by 25% to $54.1 billion. These positive results can be attributed to the higher volumes of patients and prescriptions as well as strategic acquisitions.

Health Insurance Startups' Resilience and Adaptation:

Health insurance startups, despite facing challenges, have managed to narrow their losses during the first quarter of 2023. Alignment Healthcare saw its net loss shrink by 8.4% to $37.3 million, with revenue increasing by 27.1% to $439.2 million. Similarly, Oscar Health's net loss decreased by 48.7% to $39.6 million, and revenue rose by 51% to $1.4 billion. These improvements were achieved through measures such as premium hikes, improved risk-code capture, and renegotiation of vendor contracts. However, not all startups experienced positive outcomes. Clover Health's net loss declined by 3.8% to $72.6 million, and revenue fell by 39.6% to $527.8 million, while Bright Health faced severe financial problems and decided to exit the health insurance business entirely.

Common Themes and Insights:

Despite the different contexts, both the U.S. economy and insurers share common themes that contribute to their success in achieving a soft landing. The prioritization of worker retention in the economy ensures stability and prevents a downward spiral. In the case of insurers, strategic acquisitions, increased membership, and adaptation to market conditions have led to profitability. These commonalities highlight the importance of resilience, adaptability, and long-term planning in maintaining a healthy economic landscape.

Actionable Advice:

  • 1. Prioritize worker retention: By focusing on keeping employees during economic uncertainty, businesses can contribute to a soft landing and maintain consumer spending power.
  • 2. Embrace strategic acquisitions and market adaptation: Insurers can enhance their profitability by identifying growth opportunities, expanding membership, and adapting to changing market conditions.
  • 3. Foster a culture of resilience and long-term planning: Both the U.S. economy and insurers can benefit from fostering a culture that emphasizes resilience, adaptability, and long-term planning to navigate uncertainties and achieve sustainable growth.


The U.S. economy's ability to achieve a soft landing through worker retention and the success of insurers during the first quarter of 2023 exemplify resilience and adaptability. By prioritizing stability and long-term planning, businesses can navigate economic uncertainties and contribute to a thriving economy. The common themes and actionable advice provided in this article serve as a guide for businesses and insurers to achieve sustainable growth and overcome challenges.

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