Aetna Inc. CEO Mark Bertolini might just be clairvoyant.
Insurers have been pulling back on the health insurance exchanges created under the Affordable Care Act, leading some to wonder about the program’s future. And Investor’s Business Daily reports that Bertolini predicted problems back in 2012.
Bertolini reportedly warned there could be high premiums in some markets. And a few years later, he said his company might have to pull off the exchanges if those rate hikes weren’t approved.
“And we’ve done all that math,” he said at an investors conference in 2012. “We’ve shared it with all the regulators. We’ve shared it with all the people in Washington that need to see it. And I think it’s a big concern.”
Aetna said last week it will slash about 70 percent of what it offers on the Obamacare insurance exchanges next year. That move followed similar announcements by other major insurers, including United HealthCare Services Inc. and Louisville-based Humana Inc., which said last month that it would leave some markets, discontinue products and raise rates.
In addition to modifying what products they sell and where, some companies are raising rates. According to Investor’s Daily, Bertolini also predicted that in an interview with CNBC’s “Squawk Box” in 2014.
“Are they going to be double-digit, or are we going to get beat up because they’re double-digit, or are we just going to have to pull out of the program?” he said. “We really don’t have a good view on that.”
Despite these comments, earlier this year, Bertolini said Aetna would stay put as others bailed.
Some think Aetna’s withdrawal might have been at least partially in response to the U.S. Department of Justice’s move to block the company’s proposed $37 billion purchase of Humana with a lawsuit. But Aetna has refuted that, saying the decision was in response to market pressures.
According to a Reuters report, Bertolini also was concerned in 2012 that the individual mandate, which requires everyone to have coverage or possibly face a penalty, was too weak to work.
“Even as it exists today, the individual mandate is weak and still presents problems because the penalty is so low,” he said. “If you get rid of it, I don’t know that it makes all that much of a difference.”
That penalty is higher now, and there’s no extension for those who don’t make the enrollment deadline.
Date: August 22, 2016