Anthem Is Cautious About Continuing Participation in Obamacare

Health insurer says the law's instability has undermined company's ability to map path forward

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September 14, 2017

The vice president of individual business at Anthem told lawmakers on Thursday that the company is cautious about continuing its participation in the Obamacare exchanges due to uncertainty.

Robert Ruiz-Moss told the Senate Committee on Health, Education, Labor, and Pensions that the uncertainty in the individual market has undermined the company's ability to function effectively and has led to higher costs and a decline in choices for customers.

"While we are pleased that a number of steps have been taken to address the long-term challenges facing the individual market, the underlying lack of stability and predictability in the structure of the market continues to undermine our ability to map out a sustainable path forward," Ruiz-Moss said. "For Anthem, that has resulted in our having to make difficult decisions regarding our participation in markets across the country next year, which we do not take lightly."

Earlier this year, Anthem announced it was either exiting or scaling back participation in the Obamacare exchanges in California, Nevada, Georgia, Wisconsin, Ohio, and Indiana.

Ruiz-Moss said a stable insurance market should have a balanced risk pool, a predictable regulatory environment, and financing to make coverage more affordable.

"Unfortunately, those three conditions have failed to fully materialize, which has made the planning and pricing of health plans in the individual market increasingly difficult, leading to a deteriorating and contracting risk pool with higher costs and fewer choices for consumers," he said.

Ruiz-Moss said that not enough healthy individuals are signing up for Obamacare, and there are sometimes four different government entities that put mandates and requirements on insurers. In addition, he said prices for health care coverage are still too high as many low-income individuals cannot afford it without a subsidy.

"These uncertainties have caused health insurance plans, including Anthem, to be cautious about continuing their participation in the individual market," Ruiz-Moss said. He then provided some recommendations to stabilize the individual market, which included funding cost-sharing reduction payments, repealing the health insurance tax, a federal reinsurance program that reduces risk, providing continuous coverage, and allowing regulations to be predictable.

"While the changes that we are recommending will not change our geographic participation for 2018, they can still be implemented and operationalized for the 2018 plan year to improve the market environment for consumers—but only if actions to effectuate those changes are taken very quickly," said Ruiz-Moss. "I urge the committee to act on these recommendations as soon as possible in order to provide a more stable market environment in 2018 that leads to more affordable, quality health coverage options for consumers."