Societal

Insurers warn Obamacare is unsustainable and expect premiums to rise again

 

  • Affordable Care Act is in third year of new insurance markets
  • Anthem and UnitedHealth have complained about exchanges
  • Some companies are talking about ditching their participation in the marketplace or dramatically increasing prices
  • Affordable Care Act opened up new markets allowing millions of Americans to buy coverage, often with tax subsidies to help them afford it
  • 22 million Americans now have health coverage where previously they were uninsured

By DAILYMAIL.COM REPORTER

PUBLISHED: 11:49 EST, 16 April 2016 | UPDATED: 12:17 EST, 16 April 2016

Health insurers are seriously concerned over the future of Obamacare as many insurers rapidly lose money. 

Some companies are talking about ditching their participation in the marketplace or dramatically increasing prices – and there is also the threat of a total collapse.

The CEO of insurance provider Aetna says it’s still too early to declare the federal health care program a failure but the company ‘continues to have serious concerns about the sustainability of the public exchanges.’

Analysts had expected the program to become more stable as younger, healthier people purchased insurance, but that is not happening. 

Pricey: The HealthCare.gov website, where people can buy health insurance. Health insurers gained a sicker, more expensive patient population through the Affordable Care Act’s coverage expansion

A report by insurance company Blue Cross Blue Shield found health insurers gained a sicker, more expensive patient population after the Affordable Care Act expanded coverage in 2014.

Newer customers had higher rates of diabetes, depression and high blood pressure, among other conditions. 

They also visited the emergency room much more frequently than people who had private, individual coverage before the law expanded.

Another report, by McKinsey and Company showed insurance companies lost money in 41 states in 2014, in the individual market, which includes Obamacare marketplaces. Blue Cross of North Carolina’s CEO Brad Wilson claimed a loss of $400 million.

“There’s not going to be something magical happen that will cause this to turn around,” Wilson said to AOL.

Researchers caution against drawing broad conclusions about the newly insured based on what amounts to a limited look at a still-evolving health care market. But the numbers show how gaining coverage is only part of a long journey toward the ACA’s other key goals of improving health and slowing cost growth.

‘The coverage is the first step,’ said Linda Blumberg, a health insurance expert at Urban Institute, a nonprofit research organization. ‘Figuring out how to help these folks use medical care in the most effective ways is a real challenge.’

Going up Republican members of Congress who were against the Affordable Care Act have long-warned of the problem of insurers being forced to raise premiums

The association compiled its report from dozens of insurers that sell Blue-branded coverage in 46 states and Washington, D.C. It compared claims from newer customers with two populations: people who bought coverage before the law expanded and those who have insurance through an employer.

Medical costs for new customers were, on average, 19 percent higher in 2014 and 22 percent higher in 2015 than for customers with employer-based coverage.

Health insurers expected their initial wave of patients from the ACA expansion to generate higher-than-normal claims because some of the uninsured had not used the health care system for years and were waiting for coverage to help pay for needed care.

Companies also have struggled initially to add younger consumers who don’t consume as much health care, and they have been hurt by expensive patients who sign up outside regular enrollment windows.

Basic economics also may be behind the higher health care use, since the law lowered care costs by expanding coverage.

‘If you lower the price of anything, people are going to use it more,’ said Blumberg, the Urban Institute expert who did not work on the Blue Cross Blue Shield report.

‘We’re not gonna tear up’ Obamacare: Sanders on healthcare

She added that it is too early to draw firm conclusions about trends in use, and the association’s report doesn’t include insurers that don’t sell Blue Cross Blue Shield plans.

That includes prominent exchange participants like the nation’s largest insurer, UnitedHealth Group Inc., Aetna Inc. and Molina Healthcare Inc.

Even so, Blue Cross Blue Shield Association Senior Vice President Alissa Fox said their findings underscore a need for better care management.

That means making sure newly insured diabetes patients get regular blood sugar checks, or those with other chronic diseases keep taking their medicine. 

It also involves basic steps like connecting patients with a primary care doctor and teaching them about preventive care like flu shots that can ward off more expensive treatments.

Many newly insure patients are used to simply waiting until they become very sick and then going to an emergency room, said Dr. J. Mario Molina, CEO of Molina Healthcare. 

His company offers coverage on public exchanges in nine states. Molina said earlier this year that they have been surprised with how hard it has been to draw new patients into a doctor’s office.

‘They had been uninsured for so long that they didn’t understand that this is what … modern insurance is all about,’ he said. ‘It’s about prevention and getting ahead of problems, not waiting until the last minute.’

Read more: http://www.dailymail.co.uk/news/article-3543502/Insurers-warn-Obamacare-unsustainable-expect-premiums-rise-again.html#ixzz4635VHObr
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