Health plan execs take calm view of reform


Speaking to investors at a recent healthcare conference, payer executives sidestepped naysayers' gloomy predictions about the Affordable Care Act and instead described reform as a cross between a solvable problem and a significant business opportunity, The Washington Post reported. Health insurers, execs emphasized, are taking the long view instead of pushing the panic button prematurely; they're staying in the individual market despite the ACA's knotty rollout.

"Our view is we're still in the early innings," Cigna CEO David Cordani told the crowd, the Post noted. "The first couple of years will be choppy, and we're learning whether it [reform] can find its legs."

WellPoint CEO Joe Swedish echoed that sentiment. "Some have asked are we committed to the exchanges going forward and just to underscore our view, it is the law, it will be executed albeit with continued lumpiness over a period of time," he told the Post in an interview. His comments remained consistent with earlier WellPoint predictions of enrollment growth despite exchange glitches. And Humana CEO Bruce Broussard said his company has no plans to leave state exchanges.

This keep-calm-and-carry-on stance may flow from preemptive preparation for the ACA launch and limited exposures linked to it. Like physician practices, many payers approached ACA exchanges conservatively, entering "only a handful of exchanges," the Post noted.

On average, exchange income represents only 2 percent of insurers' revenues, J.P. Morgan analyst Justin Lake told the Post. Even as exchange enrollment climbs, the marketplaces will cover only 7 percent of the population, according to Congressional Budget Office predictions, which is a fraction of payers' customer bases. This mirrors what's happening in physician practices, where sickly exchange patients seeking acute care have comprised a small portion of overall appointment requests.

Payer executives were unfazed by early reports that exchange enrollees are older, sicklier Americans. "It's not about whether you're getting a sicker book [of business]," reflected WellPoint CFO Wayne DeVeydt, "it's whether you're priced for it."

For more:
- read the Washington Post article and interview

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