Insurers Leaving the ACA Marketplace

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Another insurance company in Arizona has decided to leave the Affordable Care Act marketplace. Swapna Reddy, a clinical assistant professor in Arizona State University’s School for the Science of Health Care Delivery, will talk about why insurers continue to leave the ACA Marketplace.

TED SIMONS: COMING UP NEXT ON "ARIZONA HORIZON." ANOTHER INSURANCE COMPANY QUITS THE STATE'S AFFORDABLE CARE ACT MARKETPLACE. TEMPE BUSINESSES LOOK TO HELP THE HOMELESS IMPACTED BY A NEW CITY ORDINANCE AND DETAILS OF A PUBLIC SERVICE AWARD NAMED IN HONOR OF A SLAIN CONGRESSIONAL AIDE. THAT'S NEXT ON "ARIZONA HORIZON."

ANNOUNCER: "ARIZONA HORIZON" IS MADE POSSIBLE BY CONTRIBUTIONS FROM THE FRIENDS OF ARIZONA PBS. MEMBERS OF YOUR PBS STATION. THANK YOU!

TED SIMONS: GOOD EVENING AND WELCOME TO "ARIZONA HORIZON." I'M TED SIMONS. ARIZONA SENATOR JOHN MCCAIN TODAY JOINED IN THE CRITICISM OF REPUBLICAN PRESIDENTIAL NOMINEE DONALD TRUMP OVER TRUMP'S DISPARAGING COMMENTS REGARDING THE PARENTS OF A MUSLIM U.S. ARMY CAPTAIN WHO DIED HEROICALLY IN IRAQ. THE FALLEN SOLDIER'S FATHER SPOKE DURING THE DEMOCRATIC NATIONAL CONVENTION AND CRITICIZES TRUMPS CALL TO BANNED MUSLIMS ENTERING THE US. MCCAIN PRAISED THE CAPTAIN FOR HIS HEROIC ACTIONS AND SAID, QUOTE, ARIZONA IS WATCHING. IT'S TIME FOR DONALD TRUMP TO SET THE EXAMPLE FOR OUR COUNTRY AND THE FUTURE OF THE REPUBLICAN PARTY. WHILE OUR PARTY HAS BESTOWED UPON HIM THE NOMINATION, IT'S NOT ACCOMPANIED BY UNFETTERED LICENSE TO DEFAME THOSE WHO ARE THE BEST AMONG US. DESPITES THE CONDEMNATION OF TRUMP'S REMARKS, MCCAIN STILL SUPPORTS TRUMPS AS THE REPUBLICAN NOMINEE FOR PRESIDENT. ANOTHER INSURANCE COMPANY IS LEAVING ARIZONA'S AFFORDABLE CARE ACT MARKETPLACE THIS AFTER FOUR OTHER PROVIDERS RECENTLY ANNOUNCED PLANS TO EXIT OR SCALE BACK COVERAGE IN ARIZONA STARTING NEXT YEAR. JOINING US NOW IS SWAPNA REDDY, A CLINICAL ASSISTANT PROFESSOR AT ASU'S SCHOOL OF SCIENCE OF HEALTHCARE DELIVERY. WELCOME TO ARIZONA HORIZON, GOOD TO HAVE YOU HERE.
SWAPNA REDDY: THANK YOU, THANKS FOR HAVING ME.
TED SIMONS: ANOTHER INSURES LEAVES MARKABLE, WHAT IS GOING ON HERE?
SWAPNA REDDY: WHAT I THINK WE ARE SEEING HERE IT'S EARLY DAYS STILL FOR THE AFFORDABLE CARE ACT AND WE'RE SEEING A NATURAL EVOLUTION OF SOME INSURERS JUMPING ON SOME INSURES LEAVING AND REALLY TRYING TO FIGURE THE BALANCE FOR WHAT WORKS FOR INSURERS BUT ALSO WHAT MEETS THE NEEDS OF THE INSURED.
TED SIMONS: IS THERE A REASON WE'VE GOT UNITED HEALTHCARE, HUMANA, HEALTH NET, BLUE CROSS/BLUE SHIELD, NOW HEALTH CHOICE -- THESE ARE ALL VIABLE AND STRONG INSURANCE COMPANIES, AND THEY'RE SAYING WE DON'T WANT TO PLAY ANYMORE, WHY DON'T THEY WANT TO PLAY ANYMORE?

SWAPNA REDDY: I THINK AT THIS POINT THEY'RE TRYING TO FIGURE OUT A WAY TO MAKE THE TO MAKE THE COST AND COVERAGE WORK AND HOW THEY CAN ANTICIPATE IN OUR MARKETPLACE HERE IN ARIZONA. FOR BLUE CROSS BLUE SHIELD, THEY'RE NOT LEAVING ARIZONA ALTOGETHER, THEY'RE REALLY JUST LEAVING MARICOPA AND PINAL, THAT'S SIGNIFICANT BECAUSE THAT'S WHERE THE POPULATIONS CENTERS ARE AND THEY'RE REALLY NOW GOING TO BE FOCUSING ON RURAL COUNTIES. WHAT WE'RE REALLY SEEING IS A HIGH -- A HIGH POPULATION OF -- HIGH UTILIZERS OF HEALTHCARE AND NOT ENOUGH HEALTHY YOUNG PEOPLE THAT ARE JOINING THE INSURANCE MARKETPLACE AND REALLY, THE NUMBERS AREN'T WORKING OUT. BUT LIKE I SAID, STILL EARLY DAYS IN THE ACA THESE DAYS AND WE'RE IN A PLACE WHERE WE'RE FIGURING OUT WHICH WAY TO GO.

TED SIMONS: THOSE NUMBERS WERE SUPPOSED TO WORK OUT. THAT WAS THE REASON THIS THINGS EXISTED. WAS IT THAT THE CALCULATIONS WEREN'T RIGHT? WILL THESE FOLKS EVENTUALLY COME ON?

SWAPNA REDDY: HOPEFULLY, THAT IS WHAT WE HOPE TO SEE AND YOU KNOW WE HAVE UNTIL AUGUST 9:00 TO KNOW EXACTLY WHO IS ACTUALLY GOING TO BE ON AND OFF IN ARIZONA AND A LOT CAN HAPPEN BETWEEN NOW AND THEN. THIS ISN'T THE ONLY PLACE IN THE COUNTRY WHERE THIS IS HAPPENING. THERE'S INSURERS JUMPING ON AND OFF IN MANY STATES AND IN A LOT OF WAYS, ARIZONA HAS ACTUALLY HAS HAVE A REAL ROBUST MARKETPLACE, WE USED TO HAVE EIGHT INSURERS AND EIGHT CARRIERS IN ARIZONA, AND IN MARICOPA COUNTY, WE HAD EIGHT, AFTER THIS, WE'LL HAVE UNFORTUNATELY ONLY HAVE THREE. SO THAT'S NOT GREAT NEWS. IT'S CERTAINLY NOT WHAT WE WANT TO SEE, BUT THINGS CAN CHANGE YEAR TO YEAR EVERYTHING CAN CHANGE.

TED SIMONS: WAS THAT ROBUST ENVIRONMENT JUST UNREALISTIC OR IS THIS EBB AND FLOW? COULD THESE COMPANIES COULD HEALTH CHOICES AND HEALTH NETS WIND UP COMING BACK ON TO THE MARKETPLACE?

SWAPNA REDDY: I THINK ABSOLUTELY. DEPENDING ON WHAT HAPPENS IN OUR PARTICULAR MARKET AND WHAT HAPPENS WAS INCREASED OUTREACH AND GETTING MORE PEOPLE, TARGET DEMOGRAPHICS TO SIGN ON AND WHAT HAPPENS IN OTHER STATES. ABSOLUTELY THEY COULD COME BACK ON.

TED SIMONS: I NOTICED HEALTH NET MENTIONED BUSINESS AND REGULATORY ENVIRONMENT AS REASONS FOR DROPPING OFF. WHAT DOES THAT SAY TO YOU?

SWAPNA REDDY: WHAT THAT SAYS TO ME, FRANKLY, THE NUMBERS ARE FRANKLY NOT WORKING OUT FOR THEM. BUT AGAIN, REGULATORY PROVISIONS CHANGE. AND THE MARKET WILL CHANGE AND THE POPULATION CHANGE AND THE NUMBERS OF PEOPLE WHO ARE ACTUALLY SIGNING UP FOR INSURANCE WILL CHANGE AS WELL.

TED SIMONS: THE IDEA REGARDING THIS WHOLE DEAL WAS COMPETITION AND IF I RAN AN INSURANCE COMPANY AND DECIDED I'M OUT OF HERE, NOT WORKING, YOU WOULD SEE AN OPENING WITH YOUR COMPANY AND COME IN AND FILL THE VOID. WILL WE SEE THAT?

SWAPNA REDDY: IT'S HARD TO SAY, WE DON'T KNOW BUT ONE THING THAT WE DO KNOW IS THAT ONE OF THE MAIN GOALS OF THE ACA WAS FOR CONSUMERS TO HAVE LOTS OF CHOICES AND FOR INSURERS TO BE COMPETING FOR CONSUMERS' BUSINESS. THE MORE CARRIERS THAT LEAVE THE MARKETPLACE, THE LESS OF THAT. IT'S FOR THE GOOD FOR CONSUMERS. THAT BEING SAID, IF HE CAN FIGURE OUT A WAY FOR THE NUMBERS TO WORK FOR IT TO WORK FOR BOTH THE INSURERS AND THE INSURED, AND A LOT THAT MEANS ACTUALLY IS HAVING MORE OUTREACH TO THE YOUNG AND HEALTHY POPULATIONS THAT ARE ELIGIBLE TO BE COVERED, I THINK WE'LL SEE A SHIFT.

TED SIMONS: THE IDEA THAT MARICOPA COUNTY ONLY HAVING THREE OF THESE COMPANIES FOR NEXT YEAR, BUT ALSO WITH THE OTHER COUNTIES THE RURAL COUNTIES, HOW ARE THE RURAL COUNTIES SHAPING UP?

SWAPNA REDDY: IT'S A DIMMER PICTURE FOR THE RURAL COUNTIES, THERE ARE EIGHT RURAL COUNTIES THAT ARE GOING TO HAVE ONLY ONE CARRIER. AGAIN WHICH IS NOT A GREAT PICTURE FOR THEM. AGAIN THINGS CAN CHANGE AND THINGS CAN CHANGE GREATLY IN THE NEXT YEAR AND IF BLUE CROSS BLUE SHIELD WANTS TO ONLY FOCUS ON RURAL COUNTIES. WE WILL SEE HOW THAT LOOKS LIKE BECAUSE THERE IS STILL LOTS OF HEALTH PLAN OPTIONS AVAILABLE, ITS JUST GOING TO BE ONE CARRIER IN THOSE RURAL COUNTIES.
TED SIMONS: YOU MENTION THAT ARIZONA IS NOT THE ONLY PLACE WHERE THIS IS HAPPENING. CAN WE LEARN FROM SOME OF THESE OTHER STATES THAT ARE GOING THROUGH SOMETHING SIMILAR.
SWAPNA REDDY: SURE, I THINK ABSOLUTELY. I THINK BEST PRACTICES ARE KEY WITH THE ACA, AS WE'RE STILL IN THIS FIRST ITERATION OF WHAT IT LOOKS LIKE AND WHAT THE REGULATIONS LOOK LIKE. AND REALLY, WHAT THE MARKETPLACE LOOKS LIKE. I THINK WE ABSOLUTELY SHOULD LOOK AT OTHER STATES TO SEE BEST PRACTICES, ESPECIALLY STATES THAT HAVE HIGH RATES OF UNINSURED LIKE ARIZONA. SIMILAR POPULATIONS AND A SIMILAR POLITICAL CLIMATE.

TED SIMONS: WHAT IS ALL THIS DOING AS FAR AS FOLKS TRYING TO GET A GOOD PRICE? THOSE WHO QUALIFY FOR THE MARKETPLACE FOR ACA, GETTING A GOOD PRICE. THE WHOLE IDEA OF THIS WAS AVAILABILITY OF HEALTHCARE AND LOWERING THE COST. WHAT DOES SOMETHING LIKE THIS DO TO BOTH OF THOSE GOALS?

SWAPNA REDDY: THAT'S A GOOD QUESTION. IN ARIZONA WE STILL HAVE LOWER PREMIUMS THAN MANY OTHER STATES IN THE UNITED STATES. IN 2016, EVEN THOUGH THERE WERE RATE INCREASES, WHEN CONSUMERS SHOP AROUND AND WHEN THEY HAVE THE SUBSIDIES APPLIED AND 74% OF THOSE ENROLLED ARE ELIGIBLE FOR SUBSIDIES, THEY HAD LOWER RATES THAN IN 2015 AND OUR PER PERSON PREMIUMS WERE ONE OF THE LOWEST IN THE UNITED STATES.

TED SIMONS: INTERESTING, WITH ALL OF THAT IN MIND, THE FUTURE OF THE ACA, THE AFFORDABLE CARE ACT, IN ARIZONA, THE FUTURE AROUND THE COUNTRY. WHAT ARE YOU SEEING?

SWAPNA REDDY: I DON'T -- I THINK IT'S DIFFICULT TO SAY EVERYTHING IS GREAT OR EVERYTHING IS HORRIBLE. I THINK OF THE ANSWER IS MORE NUANCED, SOMEWHERE IN BETWEEN. THE ACA AS A WHOLE HAS INSURED 20 MILLION NEW PEOPLE AND THAT WAS A SUCCESS AND THAT WAS THE MAJOR GOAL OF THE ACA. WE CAN'T DISCOUNT THAT. AT THE SAME TIME, WE HAVE ISSUES WITH THE INSURANCE CARRIERS JUMPING OFF AND IF WE DON'T HAVE CARRIERS AND PEOPLE CREATE THE ACCESS, WE'RE NOT MEETING THE NEEDS OF THOSE BECOMING INSURED. THE ACA IS IN ITS FIRST ITERATION, A LOT MORE TO GO AND WE'RE IN A LEARNING PROCESS AND IT'S A NATURAL EVOLUTION OF AN UMBRELLA PIECE OF LEGISLATION LIKE THAT. SO IT'S IMPORTANT TO UNDERSTAND WHAT IS HAPPENING IN OTHER STATES.

TED SIMONS: SO THOSE SAYING AHA! I TOLD YOU SO THE ACA IS A FAILURE, YOU SAY NOT SO FAST.

SWAPNA REDDY: ABSOLUTELY, I DON'T THINK WE CAN JUMP TO THAT CONCLUSION, I DON'T THINK IT'S A FAILURE. THERE'S THREE MAIN GOALS OF THE ACA AND ONE WAS TO LOWER COST AND INCREASE QUALITY AND IN MANY CASES WE'VE DONE THAT AND NUMBER TWO WAS TO PROVIDE -- SORRY, PROTECTIONS FOR THE CONSUMER. WE'VE DONE THAT BY REMOVING THINGS LIKE PREEXISTING CONDITIONS AND THE THIRD WAS INCREASED ACCESS AND WE'VE LARGELY DONE THAT BY INSURING 20 MILLION NEW PEOPLE. IT'S REALLY HOW DO WE DO THIS BETTER AND HOW CAN WE IMPROVE IT VERSUS JUST SCRAPPING THE WHOLE THING, WHICH IS UNREALISTIC AT THIS POINT.

TED SIMONS: GOOD INFORMATION, GOOD TO HAVE YOU HERE. THANKS FOR JOINING US.

SWAPNA REDDY: THANKS FOR HAVING ME. ¶¶

Swapna Reddy: Clinical Assistant Professor in Arizona State University School for the Science of Health Care Delivery

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