Healthcare Uncertainty Weakening ACA Exchanges By Nicky Riordan

This week Aetna announced that it will be exiting its final individual marketplaces in Delaware and Nebraska prior to 2018. This decision makes Aetna the third major insurance provider to significantly reduce its participation in public exchanges nationwide, following on the heels of Humana and UnitedHealth Group.

Uncertainty over the way President Trump and Health and Human Services will administer the law has already accelerated a disintegration of the individual marketplace in some states. Sixteen counties in Eastern Tennessee will likely see zero options in the individual marketplace in 2018, and many states will have counties with only one option.

With little optimism that the Trump Administration will work to improve or even uphold the current law, insurance providers are making decisions in the next few months to either pull out of the marketplaces entirely, or to continue raising premiums at unsustainable rates next year.

These decisions come at a time when the individual marketplace was actually beginning to stabilize for insurers, yet this reality has been overshadowed by the passage of The American Health Care Act and uncertainty as to whether the Administration will withhold funding and undermine key components of the current law.

Although the President is hedging his bets that an implosion of the ACA marketplaces will play to his hand, insurers have made it clear that their upcoming decisions will be the direct result of his rhetoric. In the meantime, the Senate will begin working on their own version of repeal and replace legislation; a process which may take weeks or months “starting from scratch.”

Insurers are unlikely to have any clear notion as to whether the ACA will still be in place in 2018 - let alone if the Trump Administration will choose to enforce the individual mandate or continue making cost-sharing payments - when deciding on their participation in individual marketplaces next year. As for Aetna, they have decided to cut their losses, proving that this Republican gamble is a risky one. It remains to be seen where the American people will choose to place the blame for fewer options and rising premiums in 2018.

Nicky Riordan, Political Analyst, Utica College Center of Public Affairs and Election Research