The Allegheny County Employees’ Retirement Fund has filed a lawsuit against Aetna after the payer said it would pull out of 11 Affordable Care Act (ACA) exchanges. The retirement fund includes about 12,000 government employees, retirees and beneficiaries.
Aetna said the payer pulled out of the exchanges because it was “unsustainable” after Aetna lost $500 million in individual insurance since 2014. The lawsuit dismissed that claim and said Aetna left the exchanges in retaliation for the failed Aetna-Humana merger earlier this year.
In other ACA exchange news, there is now only one Ohio county that doesn't have any plan options in 2018 after health insurance companies in Ohio said they will cover 19 “bare counties" in that state. There is now a total of 19 bare counties in the U.S., mostly in Nevada.
The $37 billion Aetna-Humana merger ended in January after a federal judge ruled against the deal, saying it would hurt competition, including in the ACA exchange and Medicare Advantage markets.
After the ruling, the two payers agreed to drop the merger deal in February. Aetna paid Humana $1 billion for a contractual breakup fee. Following the proposed merger’s demise, Aetna announced a first-quarter net loss of $381 million, which company officials blamed on the failed merger.
The latest lawsuit states Aetna's alleged obfuscation around its reasons for pulling out of the exchanges made the company suffer in public image and in goodwill among regulators. Aetna continues to maintain it stopped participation because of financial reasons.
Meanwhile, in Ohio, 19 out of 20 counties that didn't have a single payer in the exchanges in 2018 now have an option after payers agreed to expand coverage to those counties. There is still one Ohio county (Paulding) that doesn't have an ACA exchanges option, but the Ohio Department of Insurance said it is trying to find a payer for that final county.
After the latest news from Ohio, the number of so-called "bare counties" have been cut in half. There are now 19 counties in the U.S. without any ACA exchanges plans in 2018. Those bare counties make up 12,076 enrollees and are mostly contained to Nevada.
Despite the positive news from Ohio, uncertainty reigns in the ACA exchanges after the Senate’s failed healthcare plan and President Donald Trump’s renewed threats to end cost-sharing reduction (CSR) subsidies. The subsidies help payers cover lower income Americans in the exchanges and contain out of pocket costs, such as deductibles.
The president is reportedly meeting with his staff Tuesday to discuss CSR payments and is expected to make an announcement soon. Members of Congress may try to draft legislation to permanently fund the payments.
Fitch Ratings said Monday the ACA exchange market uncertainty could hurt enrollment numbers in the exchanges. That will likely mean more uncompensated care at hospitals, said Fitch Ratings. Numerous health policy experts have said failing to pay the CSRs would result in the exchange market rapidly destabilizing.
Fitch Ratings said the best way to stabilize the exchanges is for the Trump Administration to pay the CSR payments.