Humana is the latest health insurer to significantly pull back its participation selling subsidized individual coverage under the Affordable Care Act, announcing plans to scale back next year to “no more than 156 counties” across 11 states.
The decision means Humana will reduce its Obamacare geographic presence by nearly 1,200 counties from the 1,351 counties across 19 states where the insurer currently sells individual coverage on exchanges under the health law now. UnitedHealth Group is scaling back to three states and Aetna said this week it was evaluating its participation in 15 states and wouldn’t expand to new states next year.
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Hospital system Catholic Health Initiatives’ experiment with health insurance has hit the end of the road after a couple years of heavy losses. CHI is “exploring options to sell” its health plan subsidiary, executives said in new financial documents.
The documents, released this week to bondholders, explain that top CHI executives “decided to exit the health insurance business” in May after undergoing a strategic review in March. CHI’s consolidated insurance division, QualChoice Health, formerly known as Prominence Health, has hemorrhaged money since its inception. QualChoice sells Medicare Advantage plans and commercial plans to employers in six states.
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Banning resident Jim Bailey and his wife went in recently for their annual physicals. They came away with hundreds of dollars in charges for co-pays and tests.
Bailey, 78, told me that he feels duped.
“The Affordable Care Act dictates that all annual physicals be provided at no cost to the policyholders — no deductibles or co-pays,” he said. “But that wasn’t the case with us.”
Nor will it be the case with anyone else — even though many Americans believe otherwise.
“There’s nothing in the ACA that guarantees a free checkup,” said Bradley Herring, an associate professor of health policy and management at Johns Hopkins University. “It’s surprising how many people think it’s part of the law.”
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Aetna Inc, the nation’s third largest health insurer, said on Tuesday that it no longer plans to expand its Obamacare business next year. The insurer, which is losing money on the plans it sells in 15 states to individuals on exchanges created under the Affordable Care Act, said it also was looking at whether it should continue to offer the contracts. Aetna said its exchange-based plans for individuals had a pretax operating loss of $200 million in the second quarter, and it projected the loss from that business would exceed $300 million by year-end. It had initially expected to break even on the plans.
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The Kaiser Family Foundation’s most recent Employer Health Benefits Survey found that among firms with 50 or more full-time-equivalent workers (i.e., the one’s subject to Obamacare’s employer mandate):
“four percent of these firms reported changing some job classifications from full-time to part-time so employees in those jobs would not be eligible for health benefits”
“four percent of these firms reported that they reduced the number of employees they intended to hire because of the cost of providing health benefits” . , and 10% of firms reported doing just the opposite and converting part-time jobs to full-time jobs”
This is unequivocal empirical evidence that Obamacare has had some of the adverse effects on employment predicted for years by Obamacare critics: a shift towards part-time work and even a reduction in hiring. But according to the same survey, the latter impact was offset due to the 10% of employers who converted part-time jobs to full-time jobs in order to make them eligible for health benefits.
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Small businesses have been pumping the brakes on offering health benefits to their employees since 2009, according to new data from the Employee Benefit Research Institute.
“The fact is that small employers were less likely to offer these benefits to begin with,” Paul Fronstin, EBRI’s director of health research and education program and author of the report, told Bloomberg BNA July 28. “While the ACA was designed to try to get more small employers to” offer health insurance, “it hasn’t.”
The proportion of employers offering health benefits fell between 2008 and 2015 for all three categories of small employer, EBRI found: by 36 percent for those with fewer than 10 employees, by 26 percent for those with 10 to 24 workers and by 10 percent for those with 25 to 99 workers.
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Many of the initial reports of premium increases for 2017 have been based on anecdotal examples or averages across insurers. This Kaiser Family Foundation brief takes a different approach, presenting an early analysis of changes in insurer participation and premiums for the lowest-cost and second-lowest silver marketplace plans in major cities in 16 states plus the District of Columbia where complete data on rates is publicly available for all insurers. Based on insurer rate requests, the cost of the second-lowest silver plan in these cities will increase by a weighted average of 9% in 2017.
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Health insurer Anthem Inc on Wednesday vowed to fight U.S. government efforts to block its planned acquisition of Cigna Corp and said it expects to lose money this year on its business selling individual health coverage under President Barack Obama’s healthcare law.
Anthem has argued that its planned $45-billion purchase of Cigna will give it greater leverage to negotiate better prices from healthcare providers and pass on those savings to consumers, including those signing up for “Obamacare” plans on public insurance exchanges.
“To be clear, our board and executive leadership team at Anthem is fully committed to challenging the (U.S. Department of Justice’s) decision in court,” Chief Executive Joseph Swedish told analysts on a conference call.
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Since Obamacare’s rollout in the fall of 2013, 16 co-ops that launched with money from the federal government have collapsed.
The co-ops, or consumer operated and oriented plans, were started under the Affordable Care Act as a way to boost competition among insurers and expand the number of health insurance companies available to consumers living in rural areas.
Now, just seven co-ops—Wisconsin’s Common Ground Healthcare Cooperative; Maryland’s Evergreen Health Cooperative; Maine Community Health Options; Massachusetts’ Minuteman Health; Montana Health Cooperative; New Mexico Health Connections; and Health Republic Insurance of New Jersey—remain.
Thomas Miller, a resident fellow at the American Enterprise Institute who is an expert in health policy, said each of the seven remaining co-ops have “warning indicators” leading up to when, and if, they fail.
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House Speaker Paul Ryan says he has heard personally from actuaries for a major health insurer that Obamacare is “failing.” Speaking at a Wednesday breakfast for Ohio delegates to the Republican National Convention, Ryan said that actuaries for Blue Cross Blue Shield have told him the Affordable Care Act is going downhill faster than they expected.
“As I said in the beginning, this healthcare law is going to collapse under its own weight,” Ryan said. “I met with all these actuaries from Blue Cross Blue Shield a little while ago, and they said ‘Well, congressman, the law is failing two years ahead of schedule,'” he added. “Meaning, basically, they saw it coming, but they didn’t think it would be this bad so fast.”
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