Aetna is happy with its employer plan business, but is not happy with the No Surprises Act independent dispute resolution system.
Steven Nelson, the president of the CVS Health subsidiary, talked about the business today, during a conference call CVS held to go over results for the second quarter with securities analysts.
In some recent quarters, the analysts have focused mainly on CVS Health’s drug stores, its Medicare plans and its Caremark pharmacy benefit manager unit. During today’s call, Stephen Baxter, a Wells Fargo analyst, asked about the commercial business.
“Our commercial business has been a strong performer and will continue to be strong,” Nelson said.
Cost increases have been high, but “we price for that,” he said. “We feel like we have good forecast models, and we’ve been able to use pricing discipline there.”
Even though Aetna has increased prices, sales have been strong, “so that means that our innovative products, services and capabilities are resonating,” Nelson said.
But Nelson said one negative has been the performance of the relatively new federal No Surprises Act independent dispute resolution system. The IDR system is supposed to keep patients with commercial health coverage out of some types of disputes involving out-of-network claims and make the “payers” and providers talk to each other directly.
Employers and payers have accused some providers of using the IDR system to get paid amounts far higher than what in-network doctors and hospitals would usually get for providing the same services.
“We’ve gone upstream with providers, trying to bring certain providers into the network at reasonable rates, so we can get ahead of this,” Nelson said. “When we do have a dispute, we’re resolving it more quickly.”
When payers do start IDR cases, “it’s definitely not playing out as intended,” Nelson said. “The dispute resolution process is clearly being abused by a small group of players.”
The situation is especially frustrating for employers with self-insured health plans, Nelson said.
“We need to work together to rectify this,” he said.
CVS streamed the conference call live and has posted a recording online.
CVS is reporting $3 billion in net income for the latest quarter on $106 billion in revenue, compared with $1 billion in net income on $99 billion in revenue for the second quarter of 2025.
The “health care benefits segment” — the division that includes Aetna — reported $2.4 billion in adjusted operating income on $38 billion in revenue, up from $1.3 billion in adjusted operating income on $36 billion in revenue for the year-earlier quarter.
Aetna ended the quarter providing or administering health coverage for 26 million people, down from 27 million people a year earlier.
Total commercial enrollment fell to 18.3 million, from 18.9 million, and enrollment in self-insured employer plans administered by Aetna increased to 15.8 million, from 15.3 million.
Aetna stopped selling individual and family coverage through the Affordable Care Act public exchange system this year. Aetna did not say whether any of the 3.1 million people with fully insured Aetna coverage bought individual or family coverage through the off-exchange market.
The backdrop: CVS is the latest big health insurer to post earnings for the second quarter.
Elevance said enrollment in fully insured group plans fell 5.5%, to 3.4 million, and enrollment in self-insured plans rose 1.3%, to 27.5 million.
UnitedHealth Group reported that fully insured individual and group enrollment there fell 8.3%, to 7.7 million, and self-insured plan enrollment rose 3.7%, to 22.3 million.
At Cigna, enrollment in fully insured group plans fell 3%, to 2.1 million, and enrollment in self-insured plans rose 3%, to 14 million.