Health insurers, like all stakeholders, have no idea what the advent of public health insurance exchanges next year will look like. Will these new marketplaces even get off the ground in time for open enrollment this fall? Will there be a flood or a trickle of new lives for insurers to cover in the exchanges? How will state-run exchanges differ from federally facilitated or state partnership marketplaces?
Increasingly, the talk in the industry is that 2014 will be a year of trial and error for issuers, considering the uncertainties that abound. The one area that is most likely to be treated as a laboratory for at least the first year is pricing. Health plan actuaries have had to determine their rates without a net, with no prior data on which to base premiums. The Affordable Care Act mandates for essential health benefits, 3:1 age-rating band and guaranteed issue, not to mention still-late-arriving guidance on a slew of other issues, leave many expecting a lot of “mistakes” in pricing next year — and a lot of “corrections” come 2015.
There is also experimenting taking place on strategy. Large health plans will likely pick and choose a few select exchanges and not take too many chances in the first go-around, as company CEOs keep reiterating to Wall Street analysts. Low-cost operations may seek market share, while others chase favorable margins. But no one is certain on how aggressive carriers will be.
What do you think plans will do? Will the big names like Aetna Inc. and UnitedHealth Group take a pass and be conservative on the number of public exchanges in which they participate, or will they be more active than many think and look to hook new customers into their brand?
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