INDIANAPOLIS – The latest blow to President Obama’s signature healthcare law came Monday night when Aetna, one of the nation’s major insurers, announced the company will significantly scale back its participation in the federal marketplace next year.
The company joins other major insurers like United Healthcare and Humana, which are quickly exiting Affordable Care Act, finding it difficult to make money on the federal marketplace that’s meant to attract low rates for low-income Americans.
“There’s a lot of sicker people with higher claims – right, wrong or indifferent,” Susan Rider said, a consultant with Gregory & Appel Insurance. “It’s just the way that it is, and with the cost of medication and the cost of healthcare, it takes a lot to make that engine run.”
Aetna didn’t offer marketplace plans in Indiana, but earlier this year the company had made preliminary plans to do so.
The Indiana Department of Insurance is currently reviewing rate requests for 2017.
The state has an August 23 deadline to review the proposals and submit them to the federal government.
Rider said Hoosiers on the marketplace should anticipate a double-digit increase.
Anthem for example, one of the state’s largest insurers, is requesting an average increase of 29 percent for marketplace plans. The range, according to state filings, would depend on specific plans but increase anywhere from 19.8 to 41.1 percent.
“Our 2017 rates are intended to cover anticipated claims costs driven by the increased use of medical services and higher drug costs,” Tony Felts said, spokesperson for Anthem Blue Cross and Blue Shield.
CareService Indiana is requested an average rate increase of 15.5 percent, IU Health Plans an average 9.9 percent increase and MDwise Marketplace, Inc. an average 11.5 percent increase.
“Unfortunately what might happen for some people is they’re gonna be a rate shopper versus looking at the true benefit impact,” Rider said.
What remains a major unknown for insurance companies and Americans relying on the marketplace is whether double-digit increases will now become the norm.
“We don’t know what’s on the horizon politically,” Rider said. “And it will also depend on how many carriers we have in the marketplace.”