Dive Brief:
- Aetna and Anthem assured investors and customers last week their plans in the ACA marketplace performed as projected through October and both companies backed their earnings forecasts for 2015.
- Insurance stocks fell last Thursday after UnitedHealth Group announced substantial losses from its health exchange business and said it will decide next year whether it will continue in the federal marketplace.
- Although Anthem and Aetna said they have lost money last year on the exchanges, the companies remain committed to the business.
Dive Insight:
Enrollment in the exchanges this year didn't meet initial goals and that trend has made it difficult for insurers to price their plans, according to Reuters. Also, HHS recently estimated 10 million people would have plans next year, half the industry expectations of 20 million.
In addition to UnitedHeath Group's potential exit from the exchanges, this year saw about a dozen small cooperative insurers collapse paying more medical claims than expected. Government payments to cover sicker patients will be reduced and eventually phased out by 2017.
Anthem said its enrollment dropped by 69,000 people to 824,000 in the third quarter, but CEO Joseph Swedish said the company remains committed to the business and is "continuing our dialogue with policy makers and regulators regarding how we can improve the stability of the individual market."
Aetna announced last month it lost money last year on the business, and is in the red this year but expects improvement as it learns more about its customers.
Industry analyst David Windley told Yahoo, "The exchanges currently are an unprofitable, untenable book of business. That's an industry issue."