A federal judge has ruled that Aetna wasn’t being truthful when the health insurer said last summer that its decision to pull out of most Obamacare exchanges was strictly a business decision triggered by mounting losses.
U.S. District Judge John Bates concluded this week that Aetna’s real motivation for dropping Obamacare coverage in several states was “specifically to evade judicial scrutiny” over its merger with Humana.
Aetna pulled out of Obamacare exchanges in 11 states last August, including 17 counties in Florida, Georgia and Missouri where the Department of Justice argued the merger would wipe out competition.
Aetna’s sudden decision to quit most of its Obamacare insurance markets was the latest mess in the health law’s rockiest stretch in almost three years. It’s Kevin Counihan’s job to clean it up.
Counihan, CEO of the federal insurance marketplace, told POLITICO’s “Pulse Check” podcast that Aetna’s flip-flop — the company announced Monday it will exit from 69 percent of counties it now serves through Obamacare, just three months after committing to stay and even expand — doesn’t alter the administration’s strategy.
Health insurer Aetna Inc. will stop selling individual Obamacare plans next year in 11 of the 15 states where it had been participating in the program, joining other major insurers who’ve pulled out of the government-run markets in the face of mounting losses.
It will exit markets including North Carolina, Pennsylvania and Florida, and keep selling plans in Iowa, Delaware, Nebraska and Virginia, Aetna said in a statement Monday. In most areas it’s exiting, Aetna will offer individual coverage outside of the program’s exchanges.
Aetna chief executive Mark Bertolini has no confidence Congress and the Obama administration can move past politics in an election year and make changes he believes would stabilize the Affordable Care Act’s public exchanges.
But he’s got some ideas he hopes the next Congress and White House will consider to shore up so-called “risk pools” to attract more healthy people to buy policies. Healthy people paying premiums into the “pool” are critical to cover the costs of the mounting claims of sick Americans signing up to individual private coverage on exchanges. And that’s been a problem for Obamacare.
According to a fresh report in the St. Louis Post-Dispatch (online, Apr. 29) – – (citing a Reuters story by Caroline Humer) the major U.S. health insurer, Aetna, has been submitting 2016 insurance rates geared to individuals, to state regulators. But Aetna is now also wary that it may need to examine such rate proposals following the U.S. Supreme Court’s anticipated ruling (in late June, of this year) in the case of Burwell vs. King. Pointedly, the St. Louis post Dispatch report says, “The court’s decision could affect an estimated 7 million people who receive subsidies to help pay for the plans and may not be able to afford insurance otherwise. Industry experts say insurers would probably need to raise their rates further if many people do not buy medical coverage after losing subsidies.”
CEO Mark Bertolini told CNBC on Wednesday that Obamacare has failed to attract the uninsured, and he offered a scenario in which the insurance company could be forced to pull out of program.
The company will be submitting Obamacare rates for 2015 on May 15.