United Health may stop offering ACA Exchange plans

[MichaelB]

Quote:

Originally Posted by easysurfer Already slim pickings for me as my doc is not in UHC's network. I think PPO plans on the individual market are going away like free pillows and snacks on an airline flight.

They are disappearing in some states, getting more expensive in others. The group healthcare market is still much bigger and all the major insurers have large PPO network plans there.

The Commonwealth Fund article I linked earlier reports that off exchange individual PPO plans may have attracted a higher rate of sicker policyholders who can afford unsubsidized policies. If this is the case, it makes sense for an insurer to withdraw the policy for a few years and try to move those people onto an HMO, where they can control costs more easily.

[utrecht]

If insurance companies cant make money at these sky high prices, we are in a world of sh*t.

[easysurfer]

Quote:

Originally Posted by utrecht If insurance companies cant make money at these sky high prices, we are in a world of sh*t.

Was thinking the same thing, well, perhaps different choice of wording .

There's nothing in the ACA that mandates that insurance companies have to play. So if there is no gold rush and they walk, things could get very interesting .

[OnTheBeach]

HHS (gov’t administrator of the exchanges) – said in a memo that they would fully fund risk losses for 2014
HOWEVER – this is coming out of the 2016 reserves – so if losses continue they will “explore other sources of funding for risk corridor payments subject to the availability of appropriations”.

[Mulligan]

Quote:

Originally Posted by MBSC Those not eligible for subsidies can purchase off-exchange plans. UHC will still offer off-exchange plans if they decide to exit the 2017 exchanges. No, it was a conference call where management said they will spend the first half of 2016 "evaluating" their participation/non-participation on the 2017 exchanges. UHC has 550,000 on-exchange policyholders, or about 5% of the market. It was a conference call due to a change in earnings expectations. Securities and Exchange (SEC) regulations for public companies with shareholders requires companies to disclose information impacting earnings in a timely manner. Correct. There is no change at this time. They are only evaluating their future participation.

Maybe sneaky smart on their part. People who buy on exchange are heavily subsidized and can get low out of pocket costs. Sign up and get others to pay for all the differed maladies that need to be fixed.
Many people probably don't even know about off exchange insurance. These people buying these policies have less incentive to use them since they pay the big deductibles. That may suggest better profitability for insurer.


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[marko]

Quote:

Originally Posted by Mulligan Maybe sneaky smart on their part. People who buy on exchange are heavily subsidized and can get low out of pocket costs. Sign up and get others to pay for all the differed maladies that need to be fixed. Many people probably don't even know about off exchange insurance. These people buying these policies have less incentive to use them since they pay the big deductibles. That may suggest better profitability for insurer. Sent from my iPad using Tapatalk

I've said it before: Regardless of the merits of the ACA, for something that is supposed to be so vitally important to the American people, the information and roll out of this program has been (as my former boss --a master marketer--would say) "an astonishing amateur hour".

Maybe I was naive but I was expecting a lot of TV ads, maybe a "national hour on a Sunday evening" of what is/isn't in ACA and some sort of conscious raising effort. (Like we get on registering to vote)

Some sort of reminders. Some sort of "sell".

Nada.

So, even today there are stories about people being surprised by high deductibles, many people unsure of if they're even covered, and so on.

These stories, popping up every few weeks, do not help the cause of the ACA.

This sadly reminds me of the "New Coke" rollout. Unprepared, unready and badly presented.

[Mulligan]

Quote:

Originally Posted by marko I've said it before: Regardless of the merits of the ACA, for something that is supposed to be so vitally important to the American people, the information and roll out of this program has been (as my former boss --a master marketer--would say) "an astonishing amateur hour". Maybe I was naive but I was expecting a lot of TV ads, maybe a "national hour on a Sunday evening" of what is/isn't in ACA and some sort of conscious raising effort. (Like we get on registering to vote) Some sort of reminders. Some sort of "sell". Nada. So, even today there are stories about people being surprised by high deductibles, many people unsure of if they're even covered, and so on. These stories, popping up every few weeks, do not help the cause of the ACA. This sadly reminds me of the "New Coke" rollout. Unprepared, unready and badly presented.

And lets be honest. Most Americans are not the sharpest concerning details. Look at the confusion even here with mostly informed and intelligent people. If the assumption that healthcare is so important that this law was created, why is it turning into a potential "gotcha game", whether it being people who don't understand their policies, deductibles, in network, out of network, in network according to insurance's website, but out of network in reality because "it just changed", out of network providers working in an in network hospital, etc....
No wonder, our out of country friends on this forum "don't understand our system". Heck we don't either and we live here!


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[Ian S]

I'm considering a UHC plan on the ACA for 2016. Never thought I'd be happy to be turning 65 next August!

[ivinsfan]

I see part of this problem when poking thru the MNSure site. They have a here's the best possible policy for you feature. You enter your age, general health, and then they have a huge dropdown list of "health care you might be requiring in 2016. It ranges from open heart surgery to complete knee and hip replacements and everything in between. It then shows you how to "get the most" from your healthcare dollars giving you the maximum you would pay OFP on each policy. The insurance company probably views this as how to wring every penny out of your insurance company. They have to take every application for any policy that comes across their desk. It seems very unhealthy for long term stability for the insurance companies.

[misanman]

An analyst on NBR last night seemed to imply that UHC was only the first to bring this to light and that all the major ACA insurers were having the same issues.

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[misanman]

I should have added that the analyst said that more healthy people were needed to balance all the not so healthy people that signed on right away.

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[karen1972]

I have UHC direct in 2015, on the exchange in 2016. There are only 3 providers on the exchange here so losing them would be a huge loss. I had to buy last year outside the open window, not sure how people "gamed" the system as I had 2 qualifying life events (quit job and moved to another state) and it was very difficult for my bf to prove the life events because of the very narrow list of items they take as proof.

Even without subsidy they are still the cheapest plan out there so that is likely why they are losing money. They are also the only provider that my bf drug is Tier 2, not Tier 4...so would still be cheaper to buy off exchange for him even without subsidy.

I'm more worried loss of competition. I thought we were going to get more entries, not less.

[lhamo]

I think they are trying to discourage people who will actually use the insurance from signing up for it. It is a pain in the butt to have to change insurance companies, especially mid-year, but also at any time. Especially if you have ongoing medical needs. By flagging this so early, they are essentially telling people who need insurance 1) we may not keep providing this and you may have to look for another provider either mid-year 2016 or in 2017 and 2) if we do keep providing it, the cost is going to escalate dramatically. Enough signalling for many people to be driven to another alternative, even if slightly more expensive.

I predict they will have a greatly reduced enrollment in 2016, of healthier people less likely to seek reimbursement, and will become much more profitable as a result.

[marko]

This came across just an hour ago:

Obamacare Architect: High Deductible Plans Overdone
Obamacare architect: High-deductible plans overdone

[Mulligan]

A perfect example of the process being confusing is what happened today with me. My brother emailed me this morning saying his insurance is dropping out of state at end of year. He asked me which one I had so he can get it. He lives across the state. He has no clue, that you just don't buy "what I have". He has no clue about coverage areas, in network, out of network, making sure his preferred medical providers are in the plan he buys, etc... This is not going to be able to answered with an email. We are going to have to have a bit of a discussion...


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[MichaelB]

Health care insurance is the US is very complex. Each state regulates it differently, prices and costs are secret and variable, and the health care insurance industry has evolved by focusing on exclusion, so it has thousands of different groups and networks to manage. Most individuals got their coverage from employer, who dealt with all this complexity. So many are now seeing it for the first time as individuals, and conclude this complexity (and cost) is recent.

In fact, the ability to easily compare policies is new, the result of minimum coverage mandates. Same for comparing provider networks, which we can do now because insurers must enable that. Before these mandates it was much more difficult to compare policies.

Rounding back to the original topic, is this a case where UHC has too many sick people on it's policies, or could it be UHC management is having a rough time executing their business strategy in the individual market and they are throwing the blame elsewhere?

[Mulligan]

Quote:

Originally Posted by MichaelB Health care insurance is the US is very complex. Each state regulates it differently, prices and costs are secret and variable, and the health care insurance industry has evolved by focusing on exclusion, so it has thousands of different groups and networks to manage. Most individuals got their coverage from employer, who dealt with all this complexity. So many are now seeing it for the first time as individuals, and conclude this complexity (and cost) is recent. In fact, the ability to easily compare policies is new, the result of minimum coverage mandates. Same for comparing provider networks, which we can do now because insurers must enable that. Before these mandates it was much more difficult to compare policies. Rounding back to the original topic, is this a case where UHC has too many sick people on it's policies, or could it be UHC management is having a rough time executing their business strategy in the individual market and they are throwing the blame elsewhere?

Well the model is odd to begin with. In a normal business if you are priced within reason and conduct a lot of sales, profitability follows. Do that with insurance and you could be setting yourself up for greater losses. Especially if people are wanting lowest possible price and maximum use of services.
My favorite example of insurance was a letter an insurance company released a few years ago from a very happy customer. She wrote the company about how pleased they were with all the coverage they provided. She said she got married and was wanting a baby so she picked their insurance because she heard good things about them. Then she said she was dropping them since they are not having any more children. But if they ever did she wanted them to know she was going to sign back up with them. You just cant make this stuff up!


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[Bamaman]

Like has previously been said, the ACA subsidized business is a small percentage of United Healthcare's business. But the real problem is that so many of these people have not been insured in the past and getting them healthier is very expensive. So many insureds came to them with prior existing untreated illnesses--many of which are very expensive to cure.

The young, healthy citizens have ignored getting healthcare because they've not used doctors and hospitals in the past. They're going to be mad next year when their income tax returns are adjusted for penalties for not having healthcare. And the healthcare premiums are relatively expensive--with so much of their premiums going to cover the deficit spending of the older, sicker insureds.

A big problem with the ACA is not the premiums. The biggest problem is that the customers cannot afford the incredibly expensive yearly deductibles.

[ziggy29]

Quote:

Originally Posted by Bamaman A big problem with the ACA is not the premiums. The biggest problem is that the customers cannot afford the incredibly expensive yearly deductibles.

True that. To some extent the ACA tries to address this with reduced cost sharing (below 250% of FPL), but someone at (say) 270% of FPL often can't afford a $6,000+ individual deductible or $13,000 family deductible. They just don't have that kind of money, which just winds up being uncollectible bills for the provider that has to be recouped by charging more for everyone who can pay. It's a bit of a vicious circle.

[Mulligan]

Quote:

Originally Posted by Bamaman Like has previously been said, the ACA subsidized business is a small percentage of United Healthcare's business. But the real problem is that so many of these people have not been insured in the past and getting them healthier is very expensive. So many insureds came to them with prior existing untreated illnesses--many of which are very expensive to cure. The young, healthy citizens have ignored getting healthcare because they've not used doctors and hospitals in the past. They're going to be mad next year when their income tax returns are adjusted for penalties for not having healthcare. And the healthcare premiums are relatively expensive--with so much of their premiums going to cover the deficit spending of the older, sicker insureds. A big problem with the ACA is not the premiums. The biggest problem is that the customers cannot afford the incredibly expensive yearly deductibles.

That may happen to unenlightened, but if God forbid, healthcare premiums become too expensive for me to pay, the government will not be confiscating my refund as I will make darn sure there will be none!


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