Dive Brief:
- Anthem, citing viability issues in the ACA's health insurance marketplaces, suggested Wednesday that it might cut back its ACA participation for 2018, as some of its rivals have already done for 2017.
- The health insurance giant's third quarter profits were down almost 6% and CEO Joe Swedish said during an earnings the results of its ACA business "were disappointing" due to high member medical costs.
- Swedish said the company would be looking to see adjustments to healthcare policy to help support marketplace sustainability, including changes to the risk adjustment program and rules for special enrollment.
Dive Insight:
The announcement has major implications for the health law because the marketplace's sustainability also depends on insurer participation, and competition is already markedly lower for 2017 than it was for 2016. The drop has left a growing number of consumers with only one choice for their region, and fueled critics' arguments against the individual mandate still requiring people to purchase a plan when facing a monopoly.
Anthem is currently among the key remaining participants, operating Blue Cross and Blue Shield plans in 14 states, after pullbacks by other large national payers including Humana, Aetna, and UnitedHealth.
The insurer's uncertainty for 2018 comes at a time when much about its future remains up in the air, with its possible acquisition of Cigna awaiting a decision in a legal challenge lodged by the U.S. Department of Justice. Anthem has argued that if approved, the deal would allow the company to expand its ACA participation to additional states.
It took a further hit this week with the announcement of a class action lawsuit that accuses the insurer of misleading its California customers during open enrollment by promising to "renew" coverage for 2016 enrollees, but "failing to adequately inform" them that their plans are changing from Preferred Provider Organization (PPO) plans to Exclusive Provider Organization (EPO) plans. PPO plans provide out-of-network coverage and EPO plans do not.