Don’t Look Now, But Some Insurers Are Re-entering More Robust ACA Marketplaces

Smaller niche health plans see promise where the big guys see risk.

It seems as if reports of the ACA’s demise have been greatly exaggerated. The Wall Street Journal reports today that after years of pulling out of the Obamacare marketplaces, health insurance plans have started to re-enter. That’s in part because the health plans are starting to make money because of premium rate hikes that may have finally caught up with the pace of coverage costs.

Also, Medicaid health plans—such as Molina and Centene—have always had to make due with less, so they were not as flummoxed by the ACA’s coverage mandates. They plan to re-enter ACA markets in North Carolina, Utah, and Wisconsin. Smaller and more nimble plans also see opportunity where bigger insurers see risk, and are likely to make moves: Bright Health in Tennessee, Virginia Premier in Richmond, Va., and Presbyterian Health Plan in New Mexico.  

“In the latest move, Oscar Insurance Corp. said it will enter exchanges for the first time in Florida, Arizona and Michigan next year, as well as going into new markets in Ohio, Tennessee and Texas, states where it already sells ACA plans,” the WSJ reports.

A Kaiser Family Foundation analysis perhaps helped alleviate come concerns when it found that health plans sold to consumers made as much money last year then they did since the ACA’s markets were launched in 2014.

Some wariness remains, though, because of the Trump administration’s belief that the ACA was the wrong fix for what ails health care. “In 2019, enforcement of the health law’s requirement for people to have health insurance will end, while the Trump administration is opening the door to alternative types of coverage that insurers say could pull healthy enrollees out of ACA plans,” the WSJ reports.

One of those alternative types of coverage include a new look for association health plans. The Department of Labor unveiled rules yesterday that would make it easier for small employers to ban together and purchase health insurance in the big employer market, theoretically for cheaper.

Linda Hines, chief executive of Virginia Premier, tells the newspaper: “We’re not going into this with blinders on. We’re not going in saying, ‘we’re going to make x percent margin.’”