Anthem to reconsider future participation in Obamacare
Anthem will give President Barack Obama’s signature health insurance law one more year before deciding whether to pull individual health insurance plans from some or all of the states where it offers plans on Affordable Care Act (ACA) marketplaces.
The health insurance giant said it would evaluate plans individually based on profits for 2017 before moving forward with offering plans in 14 states in 2018. Regulatory changes to the law would also play into the decision to continue or pull out of markets.
“We will likely modify our strategy in 2018,” Anthem CEO Joseph Swedish told analysts in a conference call Wednesday to discuss third-quarter earnings.
“We are going to be very surgical” in looking at both regions and states for 2018 participation, Swedish said.
Competitors Aetna and UnitedHealth Group have largely pulled out of the on-exchange individual market for 2017, while Anthem has decided to remain in the 14 states where it sells Blue Cross Blue Shield plans.
Those 14 states are California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia and Wisconsin.
Anthem is the largest private insurer in Virginia: Anthem Health Plans of Virginia, Inc. trades as Anthem Blue Cross and Blue Shield. The service area for Anthem Blue Cross and Blue Shield and its affiliated HMO HealthKeepers, is all of Virginia except for the City of Fairfax, the Town of Vienna, and the area east of State Route 123.
Anthem said its ACA exchange plans nationwide will show a mid-single-digit loss for 2016, which is less than expected because fewer sick people signed up for health insurance in the third quarter. The company said it is aiming for a slim profit next year.
For 2018, it is targeting 2018 profit margins in the low- to mid-single-digits from the individual business.
The market for individual health insurance created under ACA drew fewer than half the enrollees expected, and the members have higher medical costs than foreseen. This has led to losses at most health insurers, many of which plan to stop selling these plans in 2017, have been acquired, or have ceased business altogether.