Tag Archives: Market Consolidation

Healthcare Hypocrite of the Week: Aetna’s Mark Bertolini

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http://medcitynews.com/2016/08/hypocrite-aetna-mark-bertolini/?utm_source=hs_email&utm_medium=email&utm_content=33097793&_hsenc=p2ANqtz-8tHuz1OyW0jad1rYHbmCrWm51PA21pdsKB9af25xlqpvHnWr2o1T0b7LutMzmXzy521UtBFmUcZw75t8pNJcQYSG5Uvw&_hsmi=33097793

Mark Bertolini

Mark Bertolini, CEO of Aetna

It’s only Thursday, but it’s probably safe to announce that the winner of Healthcare Hypocrite of the Week is Aetna Chairman and CEO Mark Bertolini. And it’s not because Elizabeth Holmes and Martin Shkreli have managed to stay out of the news for a while.

Despite calling the Affordable Care Act business a “good investment” as recently as April, Bertolini has decided to pull Aetna out of most of the public health insurance exchanges. Initially, he cited the ACA risk pools as being unsustainable — in other words, too many old people with chronic illnesses and not enough young and spry customers to mitigate the risk. But as it turns out his actions may have been prompted by a desire to get even when the insurer didn’t get its way on a business deal.

On Monday, Aetna announced that it was pulling out of public individual insurance exchanges in all but four states. For the 2017 plan year, the Hartford, Connecticut-based insurer will only participate in the exchanges in 252 counties in Delaware, Iowa, Nebraska and Virginia. The reason? The company said it lost $200 million on individual plans in the second quarter and $430 million since the Obamacare insurance mandate took effect in 2014.

One-third of states have little to no competition on the Obamacare exchange markets

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http://www.healthcarefinancenews.com/news/one-third-states-have-little-no-competition-obamacare-exchange-markets

Alaska, Alabama, Kansas, North Carolina, Oklahoma, South Carolina and Wyoming, will have only one carrier per region.

As major insurers UnitedHealth, Humana and Aetna — along with smaller insurers like the Scott & White Health Plan in Texas — plan to leave theObamacare insurance markets, the exodus will leave some states without much competition on the exchanges.

A new study by Avalere predicts one-third of the country will have no exchange plan competition in 2017. Seven states: Alaska, Alabama, Kansas, North Carolina, Oklahoma, South Carolina and Wyoming, will have only one carrier per rating region in every region in the state, the Avalere study said.

States divide up their exchange market region into rating areas. Consumers may only purchase plans offered within the rating region in which they reside.

Nearly 55 percent of exchange market rating regions have two or fewer carriers, the Avalere study said.

Letter shows Aetna warned DOJ it would exit Obamacare markets if merger challenged

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http://www.healthcarefinancenews.com/news/letter-shows-aetna-warned-doj-it-would-exit-obamacare-markets-if-merger-challenged?mkt_tok=eyJpIjoiTW1Jek1EWm1PRFpqWldZeCIsInQiOiJNUE5TM3FXaktDWTF6WFlreiszSFpHRjZBeENcL3ZCS1REN01UQzVvVG9pdGNsSmZnK1BwTlJNWHhzZGdGRzdTckRoS2VqT05tMGVXZTdDWjN5SmVxbW1sR09qRDNnaTBNbEpXY3M5cjZaaUE9In0%3D

Aetna CEO Mark Bertolini (file photo)

Aetna CEO Mark Bertolini

Aetna warned the Department of Justice in a July 5 letter that it would leave the public exchange market if the agency went forward and blocked its merger with Humana.

“Our analysis to date makes clear that if the deal were challenged and/or blocked we would need to take immediate actions to mitigate public exchange and ACA small group losses,” Aetna CEO Mark Bertolini said in the letter. “Specifically, if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint.”

The letter to Ryan M. Kantor, assistant chief for litigation in the Antitrust Division, was sent days before the DOJ’s injunction blocking Aetna’s $37 billion merger with Humana, and also Anthem’s planned $54 billion deal with Cigna.

This week, Aetna announced it was exiting the Obamacare-created exchange market in all but four states in 2017, a reduction of its current participation in 15 states.

However, Aetna left the exchange markets after seeing deteriorating numbers in its second quarter results, the insurer said in a request for comment today.

“That deterioration, and not the DOJ challenge to our Humana transaction, is ultimately what drove us to announce the narrowing of our public exchange presence for the 2017 plan year,” Aetna said.

Sutter Health to employers: Waive rights to sue or pay the price

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http://www.healthcaredive.com/news/sutter-health-to-employers-waive-rights-to-sue-or-pay-the-price/424614/

 

Battle of the bulls: Aetna threatened ACA participation over Humana merger blockage

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http://www.healthcaredive.com/news/battle-of-the-bulls-aetna-threatened-aca-participation-over-humana-merger/424640/

  • In July, Aetna sent a letter to the Justice Department insinuating it would leave the ACA market if its pending merger with Humana was blocked by the DOJ, The Huffington Post reported.
  • Aetna announced late Monday it was exiting nearly 70% of the ACA markets it participated in next year (parsing down 778 counties to 242).
  • On Monday, CEO Mark Bertolini cited losses in the millions as the reason for the decision. However, the July letter obtained by The Huffington Post implies the decision was more influenced by the Justice Department lawsuit.

Top 10 Takeaways from the HealthLeaders Media CFO Exchange

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http://www.healthleadersmedia.com/finance/top-10-takeaways-healthleaders-media-cfo-exchange?spMailingID=9358582&spUserID=MTMyMzQyMDQxMTkyS0&spJobID=981233298&spReportId=OTgxMjMzMjk4S0#

Compass and Dollars

More than three dozen top healthcare finance executives share insight and strategies for tackling their toughest business challenges.

Participants at the 2017 HealthLeaders Media CFO Exchangein Coeur d’Alene, Idaho last week said they are generally optimistic about weathering the storm of regulatory changes, new payment models, and shifting market forces buffeting their organizations.

The finance executives at the invitation-only event also shared many mutual concerns such as offsetting traditional revenue-stream declines at hospitals and assessing the appetite to adopt value-based care models in their markets.

Here are 10 of the most insightful comments from the gathered finance leaders:

6 thoughts on the state of healthcare from Scripps’ Chris Van Gorder

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http://www.beckershospitalreview.com/hospital-management-administration/6-thoughts-on-the-state-of-healthcare-from-scripps-chris-van-gorder.html

Self-DiscoverySelf-Discovery

Faced with ever-changing rules and regulations, hospital and health system CEOs must constantly keep a pulse on the healthcare industry and be ready to alter their organizational strategy any day of the week. Chris Van Gorder, president and CEO of San Diego-based Scripps Health, talked to Becker’s Hospital Review about some of the biggest challenges and successes that are currently top of mind.

Mr. Van Gorder has led Scripps, a $2.9 billion integrated health system, since 2000. He is a fellow of the American College of Healthcare Executives and served as the 2010 chairman of the association.

His exposure to healthcare began as a hospital patient when he was critically injured while responding to a family dispute. After a long recovery, Mr. Van Gorder started a new career in hospital security, eventually rising through the ranks of healthcare management. Today, in addition to serving as Scripps’ president and CEO, he is a reserve assistant sheriff to the San Diego County Sheriff’s Department, in charge of the Law Enforcement and Search and Rescue Reserves. He also is a licensed emergency medical technician (EMT) and an instructor for the American Red Cross.

Here, Mr. Van Gorder took the time to answer our six questions.

Seven healthcare industry trends to watch

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http://managedhealthcareexecutive.modernmedicine.com/managed-healthcare-executive/news/seven-healthcare-industry-trends-watch

 

In Battle Of Health Care Titans, Should Insurers Act Like Wal-Mart?

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http://www.npr.org/sections/health-shots/2016/08/11/488891554/should-big-insurance-become-like-walmart-to-lower-health-costs

Who has the upper hand in health care prices?

In late July, the Justice Department sued to block both insurance mergers, arguing that competition is important to keep premiums down and that the deals “would leave much of the multitrillion-dollar health insurance industry in the hands of three mammoth insurance companies.”

They also rejected the Wal-Mart argument, which is related to what economists call “monopsony,” a concentration of buying power.

Monopsony is the opposite of monopoly: Instead of using market dominance to raise prices for consumers, huge buyers force down prices from suppliers. Wal-Mart is often described as holding monopsony-like power.

But critics of the insurance deals say monopsony can go too far. If the buyer pushes prices too low, suppliers stop producing, making needed goods and services unavailable.

“As a result of the merger, Anthem likely would reduce the rates that … providers earn by providing medical care to their patients,” the Justice Department argued. “This reduction in reimbursement rates likely would lead to a reduction in consumers’ access to medical care.”

Should Big Insurance Become Like Walmart To Lower Health Costs?

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Should Big Insurance Become Like Walmart To Lower Health Costs?

Salinas, United States - April 8, 2014: Walmart store exterior. Walmart is an American multinational corporation that runs large discount stores and is the world's largest public corporation.

http://www.npr.org/sections/health-shots/2016/08/11/488891554/should-big-insurance-become-like-walmart-to-lower-health-costs

Retail titan Walmart uses its market dominance to inflict “ruthless,” “brutal” and “relentless” pressure on prices charged by suppliers, business writers frequently report.

What if huge health insurance companies could push down prices charged by hospitals and doctors in the same way?

The idea is getting new attention as already painful health costs accelerate and major medical insurers seek to merge into three enormous firms.

Now that hospitals have themselves combined, in many cases, into companies that dominate their communities, insurance executives argue the only way to fight bigness is bigness.