Insurers Display Reluctance To Sell On Exchanges.

Reeve Conover|may 7, 2013 |Article Compilation

An analysis piece published by NAHU,reports on the lack of interest shown by the nation’s
largest insurers to join the Affordable Care Act’s new exchanges, set to
begin enrolling people in October. According to the article, this means
that in many states, there will be no added competition, a central
tenet of the President’s law. Recently, the four largest US insurers
have signaled that they are unlikely to move beyond the areas in which
they already offer coverage, meaning they
will sell on fewer than one third of the exchanges.

In Illinois, the State estimated 16 carriers would sell 260 health plans on the exchange, but only 6 companies applied to sell plans, including new Co-Op Land of Lincoln Health, Aetna, United Health and Blue Cross Company Health Care Service Corp (HCSC).

Insurers are concerned, in part, that people who have expensive medical
conditions will sign up immediately for coverage through the exchanges,
while healthier customers will wait. That could leave an insurer, at
least initially, without enough premium revenue to handle the medical
bills it receives. They’re also concerned about how fees and coverage
restrictions mandated by the law will affect the profitability of their
plans.

 

Still, HHS remains confident in the ability of the exchanges to encourage competition and
lower prices. Spokeswoman Erin Shields Britt said, “Many people will
receive up-front financial assistance to make insurance more affordable,
plus many will be new or first time customers for insurance companies.”