June 7, 2017

What Anthem's exit from the Ohio exchange means for other states

Daily Briefing

    Anthem on Tuesday announced that it will not sell exchange plans in Ohio for the 2018 coverage year, potentially leaving 18 counties in the state without an exchange insurer.

    8 ways to raise your margins

    Ohio Department of Insurance (ODI) spokesperson Chris Brock said Anthem was the only insurer that sold exchange plans in 20 of Ohio's 88 counties for the 2017 coverage year.

    Reasons for the exit

    Anthem said it is exiting the exchange markets because of uncertainty about whether the Trump administration will continue making cost-sharing payments to insurers that are called for under the Affordable Care Act (ACA), as well as volatility in the exchange market.

    Anthem said participating in the exchange market has become "increasingly difficult due to the shrinking individual market as well as continual changes in federal operations, rules, and guidance." The insurer also cited the return of the ACA's health insurance tax in 2018 as a reason for the exit.

    Anthem said it would continue selling some individual health plans outside of the exchanges in Pike County, Ohio. According to Reuters, Anthem also said it would continue to sell individual health plans that were grandfathered when the ACA took effect. According to Axios' "Vitals," the decision to maintain some presence in the state gives Anthem the opportunity to re-enter the exchanges. According to CMS, insurers who completely exit a state are prohibited from re-entering the individual marketplace for five years.

    Implications for other states

    Cynthia Cox, associate director for KFF's Program for the Study of Health Reform and Private Insurance, said Anthem's decision to largely leave Ohio "could be the tip of the iceberg."

    She said it seems that Anthem's exit "is more motivated by political and regulatory uncertainty, and it could be a sign that [the insurer] would exit nationally." She added, "If that is the case, that could leave hundreds of thousands of people without any insurer option." Cox said counties in Kentucky, Virginia, and Nevada also could be left without an insurer if Anthem decides to leave the exchanges in those areas.

    According to Politico's "Pulse," Anthem is still deciding on whether to stay in Missouri's exchange, where it is the sole insurer in 72 counties. Anthem also is a key insurer in Colorado's exchange—where it offers plans in more than 14 counties, covering more than 37,000 exchange customers.

    The $12 million patient who could break an ACA exchange

    Leslie Porras, a spokesperson for Anthem, in an email to the Washington Post's "Wonkblog" wrote that the company still is in "active dialogue" with regulators and states. "Regulations and deadlines for making the decision regarding our participation vary by state and we intend to continue our dialogue with regulators until that time," she wrote.

    According to "Wonkblog," Anthem has indicated that it plans to sell exchange plans in Connecticut and Virginia for the 2018 coverage year. The insurer in a statement said, "As the individual marketplace continues to evolve, Anthem will continue to advocate solutions that will stabilize the market to allow us to return to a more robust presence in the future."

    Reaction

    ODI spokesperson Brock said, "Congressional action is needed to restore stability." Brock added that ODI "is looking for options to help the approximately 10,500 Ohioans in counties where there may not be an exchange plan when this takes effect in 2018."

    Republican lawmakers cited Anthem's exit as a reason why the ACA should be repealed and replaced. Sen. Rob Portman (R-Ohio) in a statement said, "This is one more reason why the status quo on health care is unsustainable," adding, "Without true competition and choice in the market, we will never be able to lower health care costs for families and small businesses."

    HHS spokesperson Alleigh Marré said, "This news is heartbreaking for the millions of Ohioans who depend on access to affordable, high-quality health care, and this is a stark reminder that Obamacare is collapsing."

    Democratic lawmakers said Anthem's exit is the result of Republican efforts that have created uncertainty about the ACA. Sen. Sander Levin (D-Mich.) said, "This is the latest example of President Trump and Republicans in Congress destabilizing health care coverage for the American people." He added, "Their constant attacks and intentional efforts to create uncertainty are pushing some plans to withdraw from the marketplace and others to raise premiums" (Humer, Reuters, 6/6; Luhby, CNN Money, 6/6; Wilde Mathews, Wall Street Journal, 6/6; Johnson, "Wonkblog," Washington Post, 6/6; Coombs/Mangan, CNBC, 6/6; Diamon, "Pulse," Politico Pro, 6/7 [subscription required]).

    Access the new finance leader's resource guide

    Leaders in Congress and the Trump Administration are reassessing their approach to repealing and replacing the Affordable Care Act. No matter the outcome, one thing is for sure: there will be serious and long-lasting financial consequences for hospitals.

    This guide is intended to help you and your finance teams operate in this uncertain time. Inside, you'll find the information and no-regrets strategies needed to support mission and margin in any regulatory environment.

    Download Here

    Topics

      X
      Cookies help us improve your website experience. By using our website, you agree to our use of cookies.