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 Aetna is the largest insurer yet to announce a decision on how it
would proceed across the United States after President Barack Obama
said last month that insurers could extend these health plans under
a temporary transitional policy.
Aetna's move means that some consumers, who are required to have
health insurance in 2014 or pay a fine, will need to buy a new plan
for 2014. Aetna CEO Mark Bertolini made the comments at an investor
meeting on Thursday.
Aetna, the third-largest U.S. insurer, declined to say how many
individuals have plans that are being canceled or how many were
offered early renewals on their expiring 2013 plans to enable them
to continue coverage into 2014.
The company would have had to seek approvals for rate increases
across the United States, which it said would distract it at a busy
time of year.
Aetna's move is in contrast to some state-based Blue Cross Blue
Shield plans, such as BCBS of Florida and BCBS of North Carolina,
which have said they would extend these plans under the transitional
policy.
Obama made the policy change allowing insurers to extend health
plans under a temporary policy after hundreds of thousands of
individuals received notices that their plans were being canceled.
The cancellations became a political issue because Obama had
promised Americans that if they liked their plan, they could keep
it.
Aetna said that it has offered early renewals on plans, which allow
consumers to keep their coverage for up to a year longer and into
late 2014.
"We talked to the insurance commissioners and the insurance
commissioners have agreed with us. If we were to go to all those
states, refile all those plans, refile all those rates and do it in
time for Dec. 23, we would have paid attention to nothing else," Bertolini said.
Consumers must decide whether to buy plans on the exchanges by
Dec. 23 for coverage to start on Jan. 1, 2014.
Aetna is offering plans in 16 states, which means it covers about 30
percent of the exchange marketplace. The exchanges, created under
the Affordable Care Act, opened on October 1 to sell plans for 2014.
Technology problems have hobbled the ability of consumers to sign up
and highlighted the cancellation issue.
Some state insurance commissioners have said they will not allow
these plans to continue while others have said they would allow
insurers who rushed early renewals in by Dec. 31 to continue
them in 2014.
Still other state commissioners have simply left it up to the
insurers to decide. A few million plans were due to be canceled in
2014 and it is not clear yet how many people will in fact lose
coverage.
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Aetna said it expects to gain customers in only about 15 percent of
the marketplaces where it is priced the most competitively.
Bertolini said he expects the public health insurance exchanges,
which are under attack by Republicans, to survive the technology
issues.
"By 2015, if we get it fixed right, it'll be a new start," he said.
In addition to front-end issues, the website has also had problems
communicating data about enrollees to the insurance companies. The
U.S. government said last week that over the first two months
running the exchange, one in four transmissions had errors. That
rate is now about one in ten, the government said.
Aetna said it is still seeing these problems, but could not provide
an estimate of how many submissions have errors.
Aetna Chief Financial Officer Shawn Guertin said he is worried about
consumers being confused about whether they are enrolled in a plan.
"With where we are now it inevitably will happen," Guertin said in
an interview. "We tried to extend our payment dates to head that
particular situation off, but when you look at the number of
applications that we have and you look at the number of people that
have actually paid for Jan. 1 coverage, it's a relatively low
number as a percentage."
"It does worry me a little bit whether people actually understand
they have to pay that first month's premium," he said. Aetna has
extended the payment date to Jan. 8 for Jan. 1 coverage.
Bertolini said it is important to get the information right in time
for January and that the company has been working closely with the
government.
"We're coming up with workaround solutions in case things aren't
ready," he said. "There is a lot of that cooperation going on now,
whereas in the past it was pretty much hands off, but once the stuff
really hit the fan there was a lot of engagement."
(Reporting by Caroline Humer in New
York; editing by Michele Gershberg and Matthew Lewis)
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