Aetna Tells Feds Its Ideas For Health Care Reform

March 07--Aetna says the Trump administration's "market stabilization" regulatory changes to the Affordable Care Act are a "good first step."

Aetna submitted a seven-page comment in response to the Department of Health and Human Services' proposal to shorten the open enrollment period later this year, increase reporting requirements for mid-year enrollments and more.

There is deadline at midnight Tuesday for submitting opinions to the department. Anybody is allowed to weigh in.

Steven Kelmar, executive vice president for corporate affairs, wrote Aetna's submission.

"However, given the current state of the individual health insurance market, more is needed if consumers are to have access to affordable coverage in 2018 and beyond," he said.

Aetna said that 1 percent of its customers account for 44 percent of its claims costs, so reinsurance is needed for the program. The Affordable Care Act, commonly known as Obamacare, had reinsurance in its early years, but it was phased out at the end of last year.

The way reinsurance worked in 2016 is that if Aetna, or any other carrier, had a really expensive customer, the company paid all the claims until that customer hit $89,999. Then the reinsurance fund covered all claims from $90,000 to $250,000. If the patient's care went back above $250,000, the carrier was again on the hook.

Without this backstop for insurers, Aetna said, "we will continue to see 20+ percent premium increases and fewer choices for consumers."

Aetna praised the shorter open enrollment period and verification of mid-year enrollment qualifying events, such as losing health insurance through a job. It also likes the change that would require customers repay unpaid premiums from the last year before getting insurance in the new year. In Connecticut, about 20 percent of Obamacare individual customers skipped paying a premium in November or December or both. Aetna does not sell individual policies on the ACA exchange in Connecticut.

But Kelmar said there needs to be more flexibility within Bronze, Silver and Gold plans for plan design, and that states should be in charge of reviewing the details of networks and plans.

Aetna also addressed what it would like to see in a replacement for Obamacare, which is outside the scope of what HHS can achieve in regulatory tweaks.

Aetna supports the idea of higher premiums for people who do not stay insured whether they have coverage through a job or not. But it thinks the penalty needs to be much higher than Congress is discussing. Congress has proposed those customers should pay a 30 percent surcharge for one year; Kelmar said it should be 1.5 or twice the normal premium.

Aetna also supports a change that would make health insurance much more expensive for people in their 50s and 60s. Those customers cost the insurer about 4.8 times what a 20-something does on average. Under Obamacare, premiums charged to the oldest customers can only be three times as high as those charged to young adults. Aetna would like that to go to a 5 to 1 ratio.

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