Aetna is joining a number of other health insurance companies who have pulled out of the government-run markets because of mounting losses. This means Aetna will continue selling plans in just four states in 2017 — Iowa, Delaware, Nebraska and Virginia.
The move by Aetna comes just three weeks after the U.S. Department of Justice stepped in and filed anti-trust lawsuits against Anthem and Aetna in order to block the two companies from merging with rival health insurers Cigna and Humana.
In most states the insurance company is leaving, they say they will continue to sell individual policies, but they will be outside the health care exchanges. This means that people buying health insurance in those states won’t be eligible for government subsidies.
Aetna’s decision has given another blow to President Obama’s domestic policy law. The Affordable Care Act has brought health insurance coverage to millions of people. The principle behind the act was to require everyone to have health insurance, meaning people would be paying even when they weren’t sick.
This was supposed to work out that while making the risk pool bigger, insurance companies would be able to cover more people who were already sick. In simple language, by making everyone buy health insurance, regardless of any preexisting health problems, those people that were healthy and well would be helping to pay for those who really needed health care insurance.
But the insurance companies say the plan is not working, and in Aetna’s case, they say they have given the Affordable Care Act a three-year trial run and they are losing money. The Consumerist puts it bluntly when they wrote that Aetna thinks that people on the exchanges are too sick and expensive to their liking,
Aetna Chief Executive Officer Mark Bertolini said in a statement: “The vast majority of payers have experienced continued financial stress within their individual public exchange business. Providing affordable, high-quality health care options to consumers is not possible without a balanced risk pool.”
Aetna covers about 838,000 people through the ACA exchange in its 15 states as of June 30, 2016. Politico writes that Aetna says it has lost over $430 million since 2014 on its individual products. They are joining with about 40 other insurers who have pulled out of the exchange market. You can go HERE to read Aetna’s full statement.
So who will be left on the exchanges after the dust settles? Here is a quick look:
United Healthcare will pull out of most exchanges in the fall this year.
Anthem says it was breaking even on the exchanges, but now say they are losing money.
Humana is going along with United Healthcare and pulling out of most exchanges this fall.
Cigna, bless their hearts, is hanging in there, even after warning that Obamacare costs are rising.
