Insurers Face Doubts as they Plan for 2015

Health insurance companies across the country remain wary of setting their health plan prices for the 2015 insurance exchanges due to a lack of data needed to make evidence-based decisions. Those data points include everything from the final 2014 enrollment figures to the size of their provider networks and overall health of their new policy holders.

Jon Urbanek, senior vice president of commercial markets at Florida's Blue Cross Blue Shield, said data heavily influences what they decide to offer in the healthcare marketplace. “I can't tell you exactly yet that we've decided about counties and products and all those pieces, but we feel like participating in the marketplaces is very consistent with our mission,” he said.

Tim Jost, a health law expert and professor at Washington and Lee University in Virginia, said most national insurers have been watching the markets, so if 2014 data points show positive outcomes, more insurers are likely to be eager to participate in the 2015 exchanges.

However, some insurers may not have to worry about the risk of making decisions without data, even if they’d prefer to have it before submitting their 2015 plans. Due to an Affordable Care Act regulation, payers like WellPoint and Humana could stand to gain about $5.5 billion in cover losses. This will help insurers cover the cost of treating the disproportionate number of old and sickly over the number of young enrollees. Companies that received a profit of 3% or more would have to deposit any gains in a government-controlled fund. If they claimed at least 3% more than their premium revenue, they can access the money.

“If you want to insure the uninsured, and you want to set up a competitive marketplace and drive health-system improvement, you’re not going to do that without off-loading some of the risk for insurance providers,” said Dan Mendelson, president, Avalere Health.

Insurers must submit their proposed 2015 health plan rates to state and federal regulators by May 2014.

Around the Web

Insurers Wary of Obamacare Unknowns as they Plan for 2015 [Reuters]

Insurers’ Obamacare Losses May Reach $5.5 Billion in 2015 [Bloomberg]