An­them sees ex­o­dus of ex­change mem­bers

Modern Healthcare - - REGIONAL NEWS - —Bob Her­man

In­di­anapo­lis-based An­them lost nearly 70,000 ex­change plan mem­bers in the third quar­ter of this year, with many mov­ing from An­them to an­other in­surer. The mi­gra­tion is ex­pected to con­tinue in the fourth quar­ter and into 2016. Un­der the Af­ford­able Care Act, in­di­vid­u­als can switch their cov­er­age out­side of the ope­nen­roll­ment pe­ri­ods if they have changes in their life cir­cum­stances.

An­them re­ported last week that it had 824,000 ex­change mem­bers as of Sept. 30, down from 893,000 mem­bers at the end of the sec­ond quar­ter of 2015.

An­them CEO Joseph Swedish said peo­ple were mov­ing to their com­peti­tors be­cause of those in­sur­ers’ “un­sus­tain­able pric­ing.” He ex­pressed con­fi­dence that An­them would gain more ex­change mem­bers in the long run. “We are well-po­si­tioned for growth as this mar­ket sta­bi­lizes,” he said.

At the same time, a num­ber of not-for-profit co-op plans, which rep­re­sent some of An­them’s com­pe­ti­tion, are fold­ing. Swedish men­tioned the co-op clo­sures dur­ing an earn­ings call last week. He said An­them “will not chase price” to boost ex­change en­roll­ment and that in­sur­ers will es­tab­lish more “ra­tio­nal” plan prices in the com­ing years. De­spite higher med­i­cal-loss ra­tios in that group, An­them is still turn­ing a small profit on the ex­change plans, ex­ec­u­tives said.

An­them Chief Financial Of­fi­cer Wayne DeVeydt added that the ex­change mar­ket will “har­den” once the two tem­po­rary pro­grams that re­duce ac­tu­ar­ial risk for ex­change plans ex­pire af­ter 2016.

Even with the ex­change ex­o­dus, An­them’s third-quar­ter prof­its jumped 4% to $655 mil­lion. The in­surer col­lected more than $19.9 bil­lion in rev­enue for the quar­ter, a 7% in­crease from the same pe­riod in 2014. Med­i­caid re­mains one of the big­gest growth ar­eas.

An­them will hold a spe­cial share­holder meet­ing Dec. 3 to vote on its $54 bil­lion ac­qui­si­tion of Cigna Corp.


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