Many insurance executives whose companies are offering plans on the federal exchanges are frustrated with the realities that the rollout of the Affordable Care Act have laid bare. They’re talking about it, yes, but prying a quote from them on the record is a different matter.
Health-care consultant Larry Thompson says that, for them, speaking up would be “suicide.” “They are afraid to say anything because they don’t want HHS all over them,” he says. ”A lot of the carriers also rely on Medicaid and Medicare work, and they are afraid of retribution.” Last week, health-care consultant Bob Laszewski told CNN that insurance executives are staying mum because the White House is exerting “massive pressure on the industry, including the trade associations, to keep quiet.” He said that they’re now asking him to speak out on their behalf because “they feel defenseless against an administration that is regulating their business” and a government that accounts for an increasing share of their customer base.
Insurance companies, of course, have another reason for keeping quiet: Like any business, they need customers. That includes the young and healthy people the Obama administration is working to coax into the exchanges. For carriers, they improve the quality of the risk pool.
Nonetheless, Thompson says the murmurs he is hearing from insurers behind the scenes are not positive. ”I think everybody, unanimously, is extremely disappointed in the whole thing,” he tells me. Not only is enrollment far lower than expected, but those who are enrolling are older, sicker, and highly subsidized. Many insurance companies took on extra employees to handle the additional business they anticipated would come from the exchanges (“Unlike the government, they plan for things,” he jokes). “I know several of them that added 20, 30, 40 people,” Thompson says. “If the enrollment doesn’t come, they’re going to have to lay those people off.
Thompson predicts that by the end of next year, two phenomena will begin to unfold: first, that insurance companies, taking losses, will begin to remove themselves from the federal exchanges, and second, that wait times for doctors will rise. He even suggests that some of the exchanges may close by 2015.
The crux of the problem: “Expectations are high, and delivery is going to low. When those two things converge, the law is going to get a pretty bad rap.”