Daily Rise: What patients need to know about Aetna’s health exchange coverage cutback

Aetna is cutting health insurance marketplace coverage by 80 percent

Insurance giant Aetna announced this week its plans to cut insurance coverage for hundreds of thousands of patients that purchased individual coverage through the Affordable Care Act.

The insurance company said it will only offer marketplace coverage in just 4 states, Delaware, Iowa, Nebraska and Virginia. The decision, according to the Washington Post, cuts insurance coverage for 80 percent of patients that are currently covered through the marketplace.

This year, Aetna offered coverage in 778 counties. In 2017, that number will drop to just 242 counties in the entire country.

Aetna leaves patients in one Arizona county without any marketplace options

While politicians were busy debating the political repercussions, patients in one county in Arizona were scrambling to figure out their options.

Aetna’s decision to abandon patients in Arizona means that Pinal County could become the first county in the country without any Affordable Care Act coverage. Nearly 90 percent of patients in Pinal County that were using a marketplace plan received a subsidy – with the average subsidy totaling $230 per month.

“You’re going to see about 10,000 people who do not have access to care. Access to doctors, access to prescriptions,” Maria Villalobos, an employee at Sun Life Family Health Center in Casa Grande who is licensed to help people navigate the health insurance marketplace, told the Associated Press. “One of them, I talked to him on the phone today, he’s like, ‘Does this mean I have to move? I have to go to a different county?”

Patients in Pinal County won’t be alone for long. Many patients are finding limited options on the marketplace.

“The vast majority of states will have multiple insurers next year. We don’t know with certainty yet, but roughly four or five states could have just one insurer in the whole state,” Cynthia Cox, associate director of health reform and private insurance at Kaiser Family Foundation, told USA Today. “What we are seeing, though, is at the county level and mostly in rural, southern areas. I suspect that about one in four counties are at risk of having just one insurer on the exchange next year.”

Payback: Aetna CEO promised to cut coverage as retaliation for Justice Department opposition to Humana merger

So, why did Aetna decide to cut health insurance coverage for hundreds of thousands of patients insured through the insurance marketplace?

Payback.

The Huffington Post reports that Aetna CEO Mark Bertolini told federal officials last month that the company would cut its Obamacare plans — if the Justice Department attempted to block Aetna’s 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. Specifically, if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint,” Aerna’s CEO wrote to the Justice Department. “Finally, based on our analysis to date, we believe it is very likely that we would need to leave the public exchange business entirely and plan for additional business efficiencies should our deal ultimately be blocked.”

Aetna’s coverage cutback exposes bigger problems with Affordable Care Act

Aetna is only the latest insurance company to leave the insurance marketplace.

Earlier this year, both UnitedHealth and Humana announced plans to to cut insurance coverage provided on the marketplace. Most health care policymakers say that the Affordable Care Act has a flawed policy for dealing with risk pools. Patients that don’t frequently use their coverage are needed to subsidize care for other patients in need.

“You have here a situation which all of us who care about the exchanges have to worry about,” Zeke Emanuel, a former Obama health policy adviser, told the Washington Post. “There is a problem with the risk pool. There is a problem with the numbers of people signing up.”

According to The Urban Institute,  roughly 85 percent of patients that receive coverage from the marketplace — 9.4 million patients — receive a subsidy.

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