Tag Archives: Health Insurance Industry

Congress must act by March to stabilize individual markets, experts say during Senate hearing

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http://www.fiercehealthcare.com/payer/congress-must-act-by-march-to-stabilize-individual-markets-experts-say-at-senate-hearing?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiTm1RM01HUTJORE15WVdRNSIsInQiOiJFd0pManZSb09vTTVCbXdwQThsTnBycFZvaEdvbmVBZUpFWU42RFlCNHpmNW81eG5vNzFGcFRWVjRodGZFRDhWTlQ1WG1OeU5CTklYaFdjSWN0OCtaWGRLU3laOU5NVGdQV3hYWE5PVUpTeXVtcnZnWFZcL040c241SnB6SytsMXYifQ%3D%3D

America’s Health Insurance Plans CEO Marilyn Tavenner testifies during Wednesday’s Senate hearing on the state of the individual marketplaces.

Expert witnesses warned lawmakers during a Senate hearing Wednesday that if they fail to ensure a stable transition while repealing and replacing the Affordable Care Act, they risk worsening the already unstable individual marketplaces.

“Insurance markets do not respond well to uncertainty,” Julie McPeak, Tennessee’s commissioner of commerce and insurance and president-elect of the National Association of Insurance Commissioners, testified at hearing held by the Senate Health, Education, Labor and Pensions Committee. “As you consider ACA reforms, it’s critical to remain transparent and to minimize surprises in our insurance system.”

For his part, Committee Chairman Sen. Lamar Alexander, R-Tenn., asked McPeak how quickly Congress needs to act in order to shore up the marketplaces enough for insurers to feel comfortable participating in 2018.

“I think you need to provide some indication to plans as quickly as possible, but March would be extremely helpful,” McPeak said, noting that insurance carriers have to file their rates by early spring. Janet Trautwein, CEO of the National Association of Health Underwriters, agreed, saying action is needed by late March at the latest.

“Right now, plans are trying to price for ‘18, and the uncertainty around cost-sharing subsidies and the tax credits would cause them to hesitate to price because we need to understand what the funding support is going to be, because that affects premiums,” America’s Health Insurance Plans President and CEO Marilyn Tavenner added.

Thus, she pointed to suggestions AHIP has previously made public, such as making full reinsurance payments for 2016, and continuing to provide premium subsidies and cost-sharing reductions through at least 2018. “Absence of this funding would further deteriorate an already unstable market and hurt the millions of consumers who depend on these programs for their coverage,” Tavenner said.

But that isn’t enough to ensure a stable and workable transition away from the ACA, Tavenner noted. Other necessary steps include recalibrating premium subsidies to encourage more young people to participate, federal risk pool funding and continuous coverage incentives.

 

Cartoon – Who do you think is in charge here anyhow?

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U.S. judge finds that Aetna deceived the public about its reasons for quitting Obamacare

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http://www.latimes.com/business/hiltzik/la-fi-hiltzik-aetna-obamacare-20170123-story.html

Mergers in the healthcare sector: why you'll pay more

Aetna claimed this summer that it was pulling out of all but four of the 15 states where it was providing Obamacare individual insurance because of a business decision — it was simply losing too much money on the Obamacare exchanges.

Now a federal judge has ruled that that was a rank falsehood. In fact, says Judge John D. Bates, Aetna made its decision at least partially in response to a federal antitrust lawsuit blocking its proposed $37-billion merger with Humana. Aetna threatened federal officials with the pullout before the lawsuit was filed, and followed through on its threat once it was filed. Bates made the observations in the course of a ruling he issued Monday blocking the merger.

Aetna executives had moved heaven and earth to conceal their decision-making process from the court, in part by discussing the matter on the phone rather than in emails, and by shielding what did get put in writing with the cloak of attorney-client privilege, a practice Bates found came close to “malfeasance.”

The judge’s conclusions about Aetna’s real reasons for pulling out of Obamacare — as opposed to the rationalization the company made in public — are crucial for the debate over the fate of the Affordable Care Act. That’s because the company’s withdrawal has been exploited by Republicans to justify repealing the act. Just last week, House Speaker Paul Ryan (R-Wisc.) cited Aetna’s action on the “Charlie Rose” show, saying that it proved how shaky the exchanges were.
Bates found that this rationalization was largely untrue. In fact, he noted, Aetna pulled out of some states and counties that were actually profitable to make a point in its lawsuit defense — and then misled the public about its motivations. Bates’ analysis relies in part on a “smoking gun” letter to the Justice Department in which Chief Executive Mark Bertolini explicitly ties Aetna’s participation in Obamacare to the DOJ’s actions on the merger, which we reported in August. But it goes much further.

Study: In healthcare price negotiation, insurer size matters

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http://www.fiercehealthcare.com/payer/study-when-negotiating-healthcare-prices-insurer-size-matters?utm_medium=nl&utm_source=internal&mkt_tok=eyJpIjoiWmpCaVl6YzNZVGMzWW1VMSIsInQiOiJFOWcxQXlNRFltbXIzc2FocWNwREJpRnp6dEpLbmZORTVIb29WaTRtQ2lrYzVwQ1hjOW4rS1RMUDlNOEE1RVRJdEJoMjJYeEpNWUFjbnBiRUQ0WGhoSGpkUDQyWkQxZE1UQ3NBbFU1bjVwVm5ITjBTVUxRbmNWQ3JcLytnMlM0bnAifQ%3D%3D

Handshake

Larger health insurers are able to negotiate lower prices with providers, according to a new study. But that doesn’t necessarily mean payer consolidation is the answer to keeping healthcare costs in check.

The study, conducted by researchers from Harvard Medical School and published in the January issue of Health Affairs, examined multipayer claims data from 2014 to assess how insurers’ market power affected the rates that they were able to negotiate for office-based physician services.

The researchers found that greater market power did indeed give insurers a leg up at the negotiating table. For example, when examining rates for office visits paid to the same group of providers, they estimated that large insurers—those with market shares of 15% or more—negotiated prices that were 21% lower than prices negotiated by small insurers, or those with market shares of less than 5%.

Looking at providers of different sizes, the study also found evidence that insurers require greater market shares to negotiate lower prices from large provider groups than with smaller ones. And if providers respond to insurer mergers with greater consolidation of their own, that would boost their bargaining power and let them negotiate higher prices, the study said.

Antitrust trial over $37B Aetna-Humana merger nearing an end

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http://www.healthcaredive.com/news/antitrust-trial-over-37b-aetna-humana-merger-nearing-an-end/433206/

A decision on the $37 billion merger between Aetna and Humana will be made soon. The payers and the federal government have been an engaged in a legal standoff since the U.S. Department of Justice and several states filed an antitrust lawsuit in July 2016 to block the merger, citing reduced competition, hindered innovation, and increased prices to consumers. The federal government also alleges the deal would give Aetna too much of a stake in the Medicare Advantage market.

Representatives for both Aetna and the federal government have been exchanging barbs for the past several months. The government accused Aetna of scaling back its participation in ACA marketplaces as a result of the lawsuit. Aetna claimed that these accusations were unfounded and said the deal would be a pro-competitive move that would benefit millions.

Health insurance giant Anthem has also proposed a $54 billion merger with Cigna. If both mergers occur, it would combine four of the five largest insurers in the country.

There is no timeline set for a decision in the case. Yet Judge Bates said he would issue his decision in a “timely manner,” according to Bloomberg.

Foreign nation behind Anthem cyber breach, investigators say

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http://www.healthcarefinancenews.com/news/foreign-nation-behind-anthem-cyber-breach-investigators-say

The cyber attacker who breached more than 78 million Anthem consumer records in 2015 was acting on behalf of a foreign government, according to the California Department of Insurance.

Anthem is paying more than $260 million dollars for security improvements and remedial actions in response to this breach, the department said in releasing the examination findings and settlement agreement Friday.

“In this case, our examination team concluded with a significant degree of confidence that the cyber attacker was acting on behalf of a foreign government,” said Insurance Commissioner Dave Jones, who was among seven insurance commissioners leading the national investigation.

Jones and the department did not name the foreign government nor identity of the attacker.

 

Repealing Federal Health Reform: Economic and Employment Consequences for States

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http://www.commonwealthfund.org/publications/issue-briefs/2017/jan/repealing-federal-health-reform?omnicid=EALERT1150318&mid=henrykotula@yahoo.com

The Commonwealth Fund

Abstract

Issue: The incoming Trump administration and Republicans in Congress are seeking to repeal the Affordable Care Act (ACA), likely beginning with the law’s insurance premium tax credits and expansion of Medicaid eligibility. Research shows that the loss of these two provisions would lead to a doubling of the number of uninsured, higher uncompensated care costs for providers, and higher taxes for low-income Americans.

Goal: To determine the state-by-state effect of repeal on employment and economic activity.

Methods: A multistate economic forecasting model (PI+ from Regional Economic Models, Inc.) was used to quantify for each state the effects of the federal spending cuts.

Findings and Conclusions: Repeal results in a $140 billion loss in federal funding for health care in 2019, leading to the loss of 2.6 million jobs (mostly in the private sector) that year across all states. A third of lost jobs are in health care, with the majority in other industries. If replacement policies are not in place, there will be a cumulative $1.5 trillion loss in gross state products and a $2.6 trillion reduction in business output from 2019 to 2023. States and health care providers will be particularly hard hit by the funding cuts.

http://www.commonwealthfund.org/interactives-and-data/maps-and-data/the-impact-of-aca-repeal-on-employment