Humana and Covered California

Interest groups are starting to send a new wave of emails about how the Affordable Care Act exchange system is pretty much dead for 2017, or about how wonderful and affordable it is this year and how surely it won’t be dead next year.

Minnetonka, Minnesota-based UnitedHealth Group fed the critics earlier this year when it announced it was pulling out of the ACA exchange programs in many states. But it got into the ACA market late and wasn’t a major exchange plan issuer in many of those states.

Louisville, Kentucky-based Humana may have stopped the hearts of many agents and brokers in the individual market on Thursday, when it said it would cut the number of counties in which it sells individual health insurance by about 88 percent in 2017.

Humana has been providing individual health coverage for 1.1 million policyholders.

That announcement may have been part of its response to the U.S. Department of Justice effort to block its deal with Hartford-based Aetna. Maybe there was even some concern that overlap between Humana’s exchange plan footprint and Aetna’s exchange plan footprint could cause problems.

Covered California gave material for both sides when it released its proposed 2017 exchange plan menus for California. Same-plan prices are on track to rise about 13 percent, but price-driven consumers willing to shop may be able to actually cut their premiums a bit, and the benefits for consumers who have not yet met their deductibles are supposed to be richer. Plan issuer counts may be smaller in some counties but bigger than others.

And Covered California may be the best example of how the ACA individual health market would be working throughout most of the country — if we had a functional country. California really wanted an exchange, was home to a company (a unit of Word & Brown) that had been running a stable private exchange program for years, and has supported its exchange program generously.

The preliminary verdict on the preliminary 2017 menus is that the menus look stable enough for the exchange to continue to be an active program but not wonderful enough for anyone to be turning somersaults. The exchange still has to show that it can operate as the health insurance version of a stable stock exchange, without a lot of heroic government hand-holding.

But the dark cloud behind the preliminary Covered California 2017 menus is this question: How certain is it that the issuers that said they’ll plans through the exchange will really sell the plans they said they’d sell? What of the 2016 numbers are terrible, nationwide, and issuers back out?

My feeling is that the real failure of the ACA exchange as a whole may be that the state of the system performance numbers the U.S. Department of Health and Human Services puts out is still terrible, and no ACA exchange trade group has risen up to fill the void.

Many of the surviving, most stable-looking exchanges post some performance and budget numbers in a fairly consistent format. But in general, most people rating the exchanges base their ratings on how they vote in primaries. If the observers vote for Democrats, the system is doing great, in spite of understandable turbulence mostly caused by Republicans. If the observers vote for Republicans, the system has been doing terribly since time began.

I think one answer from an independent voter might be that the system looks rickety but is really just a creature of the whims of whoever wins the elections in November. If the new president and the people in charge of Congress love the ACA exchange system, it will live. If the dominant winners hate the exchange system, it will die.

If the winners are lukewarm, the system will probably lurch forward in a smelly, shriveled state, muttering curses at sellers of self-insured plans, short-term health insurance plans and health care sharing ministries, with the thought that, if not for those scoundrels, its market share would be glorious.

Another answer from an independent voter might be that the country itself is just too divided and rickety to make any new program work. Maybe, if that’s the case, the ACA exchange system will fail because its a creation of the United States of America, and the United States can no longer sire healthy offspring.

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