Rumi
“Everyone is trying to find the right person but no one is trying to be the right person.”
Relationships flourish when self-improvement precedes seeking perfection in others. Be the change you desire in connections.
A society loses its moral compass the moment profit outweighs the value of human life.
Chomsky’s words call out the mindset that treats human survival as expendable when money is involved. He argues that ordinary language fails to describe the depth of this moral failure. His point is simple: when greed becomes more important than humanity, something fundamental has already broken.
Solitude becomes a strength when the alternative threatens your character.
When George Washington warns that it is better to be alone than in bad company, he’s reminding us that the people around us shape our values, choices, and future. Choosing solitude over harmful influences protects your integrity and keeps your path clear, steady, and self‑directed.
To kick off the new show, KFF’s Business of Health with Chip Kahn, Charles Kahn III hosts Drew Altman who explains how KFF is continually evolving to research, analyze, and lead on health policy. They discuss how the new podcast will break down the business side of health care, artificial intelligence, and what it all means for health care delivery and patients.
Cigna’s earnings tell a story Wall Street loves but its retreat from the ACA Marketplace could accelerate a system already tipping toward collapse.
Cigna reported its first-quarter 2026 results last Thursday. Like most of the other big health insurance conglomerates that have reported so far, it did a better job of meeting Wall Street’s profit expectations in the first three months of the year than it did in all of 2025.
Total revenues rose 5% to $68.5 billion. Adjusted income from operations came in at $2.1 billion, or $7.79 per share — up 12% from a year ago, though missing analyst estimates by five cents. The company raised its full-year outlook for adjusted income from operations to at least $30.35 per share. David Cordani, in what he called a “somewhat bittersweet” moment as his final quarterly earnings call as CEO, described the results as reflecting “disciplined execution, deliberate portfolio shaping and a continued focus on targeted innovation.”
That jargon didn’t impress investors. Cigna’s stock price fell $3.19 on Thursday but was up 2.76% for the week, closing Friday at $282.90.
None of that is surprising. Cigna is a well-run company by the metrics Wall Street uses to measure well-run companies. What’s worth examining is what the numbers actually reveal about how the first quarter results were achieved and – equally if not more important – what Cigna announced alongside it.
The biggest news from Thursday’s release and call with analysts wasn’t about earnings. Cigna will stop offering plans on the Affordable Care Act marketplaces after the 2026 plan year. The exit will affect 369,000 members across 11 states, with coverage ending January 1, 2027.
Brian Evanko, who will succeed Cordani as CEO on July 1, framed the decision as a strategic choice to exit a market where Cigna is unlikely to achieve scale. “This is small business for us today, and it’s been shrinking in recent years,” he said.
He’s right about the numbers. What he didn’t say is why it’s shrinking — and what Cigna’s exit will do to the people left behind.
Cigna is by no means the first big insurer to announce an exit from the ACA Marketplace. Aetna pulled out at the end of 2025, forcing approximately 1 million members across 17 states to find new coverage for 2026. But even that headline understates the breadth of the retreat. At the end of 2025, when Congress chose not to renew some of the tax credits that had made ACA coverage affordable for millions of Americans, a wave of smaller insurers also left: Molina Healthcare announced significant changes to its service area; HAP CareSource exited Michigan; Chorus Community Health Plan withdrew; Mountain Health CO-OP left Wyoming; Primewell Health Services exited Arkansas and Mississippi; UM Health Plan and Michigan Care ended; and Celtic/WellCare left North Carolina. Blue Cross Blue Shield terminated PPO products in Arizona. And last month, Baylor Scott & White Health Plan announced it will no longer offer marketplace plans after the end of this year, affecting approximately 100,000 enrollees in Texas.
That means that before open enrollment for 2027 coverage even begins this fall, at least half a million people — Cigna’s 369,000 plus Baylor Scott & White’s 100,000, on top of the million who lost Aetna coverage last year — will either have to scramble to find comparable coverage (at a significantly higher price) or go uninsured.
And we may not yet know the full scope. Every spring and summer, health insurers file proposed premium rates with state regulators — filings that reveal what insurers are planning for the coming year. Those rate filings typically land in May and June. The Q2 earnings season follows in July and August. Each of those moments is an opportunity for another insurer to announce what Cigna announced Thursday. The exits we know about may be the beginning, not the end.
This is not a series of isolated corporate decisions. It is the beginning of a potential death spiral, and it is already in motion.
The mechanism is straightforward. ACA sign-ups for 2026 are already down by over 1 million people compared to the same period last year — the first decline since 2020. The main reason was the December 31, 2025 expiration of the enhanced premium tax credits that were enacted during the Biden administration. For subsidized enrollees who stayed in the same plan, average net premiums rose 114%. When premiums spike, the people who leave first are the healthy ones — younger, lower-utilization enrollees who do the math, decide the cost isn’t worth it and gamble that they’ll have another year of good health. The people who stay are the ones who have no choice: the chronically ill, the older, the people who know they will need care. The marketplace is already smaller and sicker, according to consultants and insurance executives, with more consumers choosing cheaper bronze plans that carry higher out-of-pocket costs.
A smaller, sicker pool means higher claims. Higher claims mean higher premiums. Higher premiums drive out even more healthy enrollees, which makes the pool sicker and more expensive still. And that is exactly what Evanko described when he noted that Cigna’s ACA enrollment had already dropped from 446,000 to 369,000 — a 17% decline in a single year.
The insurers aren’t abandoning a failed program. They are ensuring it fails — and then leaving before it does.
I wasn’t surprised to hear that Cigna is leaving the ACA Marketplace because it has never been a big player in the individual health insurance business. Around 90% of Cigna’s health plan enrollment is in its role as a third-party administrator (TPA) for large employers. The company also has sold all of its Medicare Advantage business.
What did surprise me was the company’s other big reveal: It has put its EviCore unit, which provides prior authorization and utilization management services to health plans (not just Cigna’s), up for sale. Evanko told analysts that the industry’s prior authorization standardization push (which I wrote about last Wednesday) could “open new doors for the EviCore business, which could potentially result in a partnership or a combination with complementary industry participants.”
EviCore is the prior authorization machinery — the infrastructure through which doctors’ requests for patient care get approved, delayed, or denied. Cigna is exploring selling it, or spinning it off, at precisely the moment that prior authorization is under the most intense public and regulatory scrutiny it has ever faced.
Think about what that means. Just days after the industry announced a voluntary reform campaign to standardize the prior authorization process, Cigna said it might sell the business unit that does the prior authorizing. That tells me that the company’s executives don’t think EviCore will be able to continue contributing to Cigna’s profits.
One of the most important numbers in any health insurer’s earnings report isn’t revenue. It’s the medical loss ratio — the percentage of premium dollars actually spent on patient care. The lower the MLR, the more the company keeps.
Cigna’s MLR for Q1 2026 was 79.8%, down from 82.2% a year ago. That 240-basis-point decline is the engine behind the strong earnings performance. For every dollar Cigna collected in premiums this quarter, it paid out roughly two cents less in medical claims than it did a year ago.
The company attributes the decline primarily to the 2025 sale of its Medicare Advantage business to Health Care Services Corporation — older, costlier populations leaving the risk pool.
What no analyst asked: Is the MLR decline connected to Cigna’s prior authorization practices? The company’s own Transparency Report, published in March, claims a 15% reduction in prior authorization volume. Did tighter scrutiny on the remaining high-cost requests contribute to lower medical costs and therefore a better MLR? We don’t know because Wall Street analysts chose not to ask.
Another thing analysts didn’t explore was litigation against its PBM, Express Scripts. Evernorth — the division that encompasses Express Scripts and that now accounts for 85% of Cigna’s revenue — generated $58.4 billion in adjusted revenues, driven by specialty drug volume and biosimilar adoption. What the earnings release doesn’t mention is that Express Scripts is currently the subject of federal RICO litigation alleging the company created a Swiss entity called Ascent Health Services to divert drug rebates away from plan sponsors and patients.
On Thursday’s call, analysts asked about Evernorth’s growth trajectory, capital deployment, the EviCore strategic review, and the CEO transition. No one asked what happens to the 369,000 people who will lose their Cigna coverage on January 1. No one asked whether the cascade of ACA exits constitutes a market failure requiring a policy response. No one asked what the prior authorization denial rate was for the quarter, or how many denials were later overturned on appeal.
Those questions have answers, but Wall Street analysts don’t ask because they assume most investors have little interest in such matters. And they are right.
New data shows middle-class Americans cutting essentials, dropping coverage, and delaying care — just as Pope Leo XIV calls health care a “moral imperative.”
Pope Leo XIV (who became pope a year ago this week) isn’t just the first American pontiff—he’s also, as a Chicago native and Villanova University alum, the first leader of the Roman Catholic Church to have experienced the U.S. health care system firsthand. So it shouldn’t come as a surprise that this world spiritual leader born as Robert Prevost would use his lofty new platform to call for radical change.
“Health cannot be a luxury for the few,” Leo told a recent conference on health care inequality in Europe organized by both Catholic bishops and the World Health Organization, adding that good health care is essential for social peace.
“Universal health coverage is not merely a technical goal to be achieved; it is primarily a moral imperative for societies that wish to call themselves just,” the pope said. “health care must be accessible to the most vulnerable, then, not only because their dignity requires it but also to prevent injustice from becoming a cause of conflict.”
In less than a year on the job, the new pontiff has shown a lot of political savvy, and a knack for good timing. Leo’s endorsement of health care as a human right coincided with a couple of new, important U.S. surveys showing that both rising insurance premiums and high out-of-pocket medical bills have become the major driver of an affordability crisis that is hitting middle-class families hard.
To back this up, the leading health care non-profit KFF conducted a followup survey with more than 800 Americans who last year had been enrolled in Affordable Care Act (ACA) insurance in 2025. It found broadly that most have been struggling to pay medical bills since Congress failed late last to extend the federal subsidies that had made ACA coverage affordable for many in recent years.
WATCH NOW: Prior Authorization: Care, Delayed | EP 3
In the third episode of the HEALTH CARE un-covered Show, we take a deep dive into prior authorization’s toll — from doctors to federal policy — featuring Dr. Wendy Dean, Dr. Seth Glickman and Rep. Suzan DelBene (D-WA) on CMS’s new AI-driven WISeR model.
Watch the full episode here.
Most of the respondents (80%) said they were paying more now for health care than in 2025, with just over half (51%) reporting they are now spending “a lot more.” For middle-class Americans, the critical need to stay healthy has meant cutting their budget for other essentials. KFF found that a majority (55%) were reducing spending on food or other household basics, but that jumped to 62% for people getting treatment for chronic disease.
Faced with drastically higher monthly premiums, KFF found, has forced these families to make difficult, consequential choices. Some 28% switched into a different ACA plan in an effort to hold down their monthly premiums – which means much higher deductibles and thus the risk of large out-of-pocket medical expenses. Even worse, some 9% told the KFF survey that they have dropped health insurance altogether, which means they are one accident or major illness away from a financial disaster.
A 34-year-old Texan who dropped his Obamacare coverage told the KFF pollsters that the sole reason was the cost. “The prices are simply too high,” he said. “$800 a month for the absolute cheapest plan for two people. Our income is $120k, so we don’t qualify for subsidies in Texas. I don’t think we could afford our mortgage if I had to pay for health insurance.”
Another respondent reported that his “Income exceeded the subsidy limit, forcing us to pay the full cost, so we switched down to a bronze from a gold plan. Even doing that our premiums are 3 times what they were in 2025, with lower plan features and a higher deductible.”
About 22% of the KFF respondents said they are still insured, but not through the ACA Marketplace. In some cases that is because they were able to switch to an employers’ health plan or because they were now eligible for Medicare and Medicaid. But others, KFF noted, switched into different types of high-deductible plans or a cost-sharing group – solutions that often lead to considerable out-of-pocket expenses.
One 56-year-old Texas man surveyed by KFF said that as a reaction to the higher insurance premiums he would “attempt to use health care as little as possible” – with the hope that by carefully consulting with his doctors and pharmacists he would avoid paying any out-of-pocket expenses that aren’t absolutely necessary.
Last week was quite a week:
That’s the context for meetings this week in DC between hospital leaders and Members of Congress as part of the American Hospital Association’s Annual Meeting. Though much of the legislative agenda for hospitals has shifted to states, federal issues still matter, especially funding in the FY 2027 federal budget and appropriations to key departments and programs.
Hospitals are on the defensive in DC. On behalf of its members and in concert with its peers (FAH, CHA, AEH, et al) they’re seeking…….
And others.
Per AHA President and CEO: “The timing of our presence and voice in Washington is especially important this year. Health care affordability remains in the spotlight. Congress is discussing the prospects of one or two more reconciliation packages this year, even as we are asking them to examine the overreach and mitigate certain health care provisions from last year’s package. And we are 199 days from the midterm elections…” (AHA Today April 17, 2026)
The reality is this: hospitals have lost much of the good will they earned during the pandemic. Pushback by AHA against hospital price transparency, site neutral payments, 340B changes et al. have been successful. But heightened visibility about executive compensation, profitability, tax exemptions, private equity ownership concerns and for-profit venture-development has eroded Congressional favor, exacerbated nurse and physician burnout and lessened community support. AHA is aware.
In 2024, AHA and its coalition changed the name of its public-relations campaign from the Coalition to Protect America’s Health Care to Coalition to Strengthen America’s Healthcare to “… support the Coalition’s expanded capacity as a proactive, always-on organization dedicated to positively shaping public perception of hospitals and health systems, neutralizing opposition attacks, and holding corporate payers accountable for their role in delaying and denying care while driving up overall health care costs.” For AHA and most hospitals, it’s been an uphill battle against think tanks (West Health, Lown et al), investigative journalists (WSJ, NYT, STAT, Modern Healthcare) and competing interests, especially insurers and private investors, who see hospitals as protectors of the past rather than designers of healthcare’s future.
To restore trust and garner good will among employees, employed physicians, local and national employers, elected officials and community leaders, hospital leaders in DC should engage Congress in several areas usually not discussed:
Proactive education targeted to key constituents explaining how hospitals operate including actual costs, AI applications, et al and notable inefficiencies. Asking for money or regulatory relief is not enough. The public’s ignorant about how hospitals operate!
Long-range planning: Hospital boards tend to plan for NOW and NEAR to but spend inadequate time on FAR. Understanding long-term changes in clinical care, technology, regulatory and economic realities are keys to preparedness. And, like capital and facility plans, executive compensation should be linked directly to organizational readiness for long-term changes along with short-term financials). Long-term planning is not a luxury or distraction; it’s necessary.
Systemness: Hospitals should lead in the design of local/regional “systems of health” that provide a full range of needed health services affordably, rationalizes resources appropriately, is connected includes health, social services and funding programmatically. They’re the logical partner with government to integrate health and social services and, as a result, reduce fragmentation and waste. No excuses.
Workforce: Hospitals should modernize workforce plans to maximize technology-enabled consumer self-care, expand mid-level opportunities, facilitate AI-enabled administrative and clinical process improvements and compensate based on merit and performance.
Consumers including patients: Hospitals and AHA should embrace “healthcare consumerism” actualize its centricity in interactions with individuals who use its services. Competition in a value-based system of health depends on customized engagement with consumers.
Positioning: And hospitals must temper the “blame and shame” game against insurers, drug companies and demonstrate leadership in affordability, administrative waste reduction and optimal resource rationalization. Being their target is understandable: hospitals are 31% of direct spending and, with employed physicians, ancillaries and diversified interests, responsible for at least 55% of the U.S. health economy.
I acknowledge hospitals are uniquely complex organizations—labor intense, capital intense and highly regulated by states and the federal government. Events like last week’s add to uncertainty about their future but efforts to “protect” their status quo are ill-conceived. It’s time for AHA and its followers to plan beyond clinical innovations, technologies and the current regulatory and political environment. Otherwise, most hospitals will be public utilities.
I do not think the future of the U.S. health system will be a repeat of its past. That’s good news and bad news for hospitals.
Paul
PS: Each week, I try to distill lag and lead indicators from the Clinical Care, Technology, Capital, Funding, Consumer and Regulatory environments of consequence to healthcare insiders. What’s abundantly clear is that outside forces—economic, political, global—will impact U.S. healthcare future more than its internal dynamics. The future for hospitals is not a repeat of their past: that’s clear. What’s unclear is who will shape that future and what role hospitals will play.
I study the future of the U.S. health system. The framework I use is based on monitoring trends, lag and lead indicators in five zones of unique relevance in the health industry at home and abroad:
Based on 30 years-plus years of applying this framework to my industry surveillance process, it’s clear that traditional lag indictors like enrollment, utilization, spending, workforce supply-demand et al are less useful in predicting its future. Instead, indicators from outside healthcare seem more aligned to its future than indicators from within. Why?
Objectively, the reality is this: the players outside healthcare including Big Tech, Big Banks and Big Employers are forcing changes faster than healthcare insiders are comfortable and the health system’s future is uncertain as a result. Boards of most healthcare organizations inadequately evaluate future state options due to urgent issues that require attention and/or lack of CEO interest. And in many, long-range planning is relegated to 5-year capital plans and program portfolio updates. Radical change is dismissed, and executive compensation is set accordingly.
Will the health system change radically? Or will it incrementally evolve? To facilitate meaningful discussion, at least three future state possibilities merit deliberation by leaders:
Big Public-Small Private: By 2040, federal and state governments fund 85% of health services funds contracting with private hospitals, medical groups and other providers based on evidence-based performance standards of quality, costs and access. Funding will be sourced from individual and employer taxes while a small percentage of the population will purchase services in a separate, smaller private market. Medicare, Medicaid, CHIP and Social Security programs will be combined (eventually) and budgets will be capped. Note: this model already in place in many developed systems i.e. Canada, UK, et al and is considered an incremental change to the status quo akin to “Medicare for Most” proponents.
Retail health: By 2040, employer tax deductions for employee health benefits are eliminated as a result of employer dissatisfaction with costs and cost shifting by providers based on underpayments by Medicaid and Medicare. Individuals are responsible for purchasing individual insurance and choosing and paying for the doctors, hospitals, medications and ancillary services they use. Note: many economists believe the unintended consequence of third-party health insurance is unnecessary waste, costs and marginalization of consumer choice in healthcare. Forced consumerism, they argue, would bring discipline to health spending. Critics (including most physicians) counter consumers are incapable of smart shopping for their health needs. This option represents a transformational change to the health system wherein its economy is based on retail health.
Restructure: By 2040, system restructuring to reset its focus. The health system’s structure is its major barrier to change. Horizontal consolidation dominant now in most sectors represents a defensive maneuver whereby insiders protect against restructure by imposing its muscle-strength. Current incentives reward specialty providers, inpatient and outpatient services, patent protected specialty drugs, institutional senior care and separate financing and delivery systems. At the same time, they discourage needed investment in behavioral health, enabling of mid-level providers, incentives based on value (costs + outcomes), community-based integration of health and social services programs and guided self-care. Systemic restructure is necessary but unlikely until and unless demanded by community leaders, elected officials and private investors. In the interim, vertically integrated community health organizations will be surrogates for wider adoption.
No one knows for sure what healthcare’s future will be, but all recognize the status quo is not sustainable. Ownership status (for-profit vs. not-for-profit) will matter less and affordability will matter more. Regulation will increase and states will play a larger role. And base rates for reimbursement will decreasingly be based on Medicare rate setting.
Protecting the status quo is not a solution. Failure to seriously evaluate future state options is professional malpractice. Outsiders want results, not excuses.
This will be a quiet week for healthcare in DC with major hearings, confirmations and legislative votes not scheduled.
Last week was relatively calm as well. The House Ways and Means Committee heard testimony from hospital CEOs of HCA, ECU Health, Common Spirit and NY Presbyterian featuring accusations of price gauging and unnecessary costs. And a study that found an OpenAI model outperformed doctors in diagnostic reasoning stirred attention in the physician and healthcare tech worlds where AI’s a dirty word to some and salvation to others.
But, for healthcare, it was an uncharacteristic quiet week. No shutdown announcements akin to Spirit’s 2 a.m. Saturday advisory “winding down all operations.” No strikes by nurses or new megadeal announcements. No public announcements from CMS on new alternative payment models or final rules on reimbursement. But It’s a temporary calm before the tsunami building offshore. It’s the cumulative result of four convergent forces each capable of destabilizing the health economy on its own:
U.S. healthcare has much to be proud of: we justifiably tout our breakthrough meds and devices, Star Ratings, Top 100 lists and modern buildings. We remind legislators we’re the biggest private sector employer in the U.S. economy and, at every opportunity, our economic impact on communities. And, in every sector of our $5.6 trillion industry, we’re now talking about affordability (without defining it).
In April, I met with several health system Boards, limited partners in 2 healthcare investment funds and health officials in 3 states. The sentiments are the same: they’re concerned about the future and preparing for the worst. They’re asking their leaders and corporate strategists to do the impossible—avert the storm, at least for a little while. They’re confident public funds for healthcare are already stretched with no relief in sight. And they’re attempting contingency planning knowing their efforts might be moot given political volatility in DC and states.
Understandably, the appetite for risk taking in organizations and government agencies like these is relatively low. It’s safer to consolidate horizontally than vertically, cut costs, change incentives, modify reg’s slightly than attempt “newer, better, cheaper” solutions to well-known problems. Old playbooks are dependable. And, for healthcare’s operators, radical incrementalism disguised as transformation has served its interests well for 50 years as spending grew from 9% of the GDP in 1980 to 18% today. Bigger players in each sector have done well and pay their executives to keep it that way while the smaller players are collapsing.
Transformation of the system, and a clear destiny for its future are secondary to self-preservation in US healthcare today. Our investors and lenders expect it, Board compensation committees reward it, and our workforce depends on it.
Thus, until and unless elected officials, large (non-healthcare) employers and concerned community leaders act, it will not happen. And if neglected, the entire system will collapse in the next 10 years.
It’s a possibility few Boards of healthcare organizations seriously consider but growing numbers of concerned citizens fear. Like Spirit Airlines passengers and its 17,000 employees are experiencing, they’re SOL.
Paul
PS: I am in Alaska this week with the Southcentral Foundation, the Alaska Native-owned 501(c)(3) nonprofit that provides comprehensive outpatient and inpatient services to more than 70,000 Alaska Native and American Indian peoples living in the Indian Health Service’s Anchorage Service Unit. Two features of how SCF operates impress me: its purposeful blending of physical, mental, emotional and spiritual wellness in care management, and its Nuka System of Care ownership model in which individuals are customer owners, not patients. There are lessons to be learned from both.
HENRY KOTULA 