Year Later, Aetna’s Cut-Rate Product Has Few Takers

In time, this may prove to be an interesting lesson in marketing. One year ago, Aetna U.S. Healthcare unveiled a bare-bones, low-cost health insurance product it said was a step toward reducing the number of uninsured Americans. Now, the company acknowledges that its experiment has failed to generate much enthusiasm.

Aetna won’t say exactly how many people have signed up for its Affordable HealthChoices plans, but admits sales are slow. Aetna blames it on regulators’ snail-like pace in approving the product, which is available in only 33 states.

Others in the industry, though, point to the very nature of the program as its weak spot. The three products pay $50 for a physician visit and $500 to $750 a day for the first three days of hospitalization. At the time it was unveiled, some consumer groups warned that enrollees who experienced serious illness or injury would be stuck with huge bills.

Then there are the skeptics, who say Aetna has never really pushed the program hard, using it only to score brownie points in Washington as debate about the uninsured intensified. The U.S. Chamber of Commerce and the National Federation of Independent Business, on the other hand, have applauded Aetna for its private-sector attempt to thin the ranks of the uninsured.

Depending on the state, individual premiums range from $46 to $91 a month — far less than other coverage on the individual market. Even so, some observers say it might cost just enough to dissuade small employers and the near-poor who don’t qualify for Medicaid from joining.

Some worried that larger employers would abandon richer benefit structures for the stripped-down model, but that seems not to have happened. The Aetna plan’s seaworthiness may be better gauged in weaker economic times.

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