Aetna, one of the world’s largest insurance providers, has announced they will abandon Obamacare exchanges next year in more than two-thirds of the counties where it now sells the coverage, the latest in a string of defections by big insurers that will limit customer choice in many markets and likely drive up costs for consumers.
Now, it appears the move was, in part, designed to send a political message from the medical industry, aimed right at President Barack Obama and the Democratic party.
And the message seems clear –“Give the health industry what it wants… or else.”
It all traces back to a letter first released by The Huffington Post that implies the move was, in some ways, payback towards the Obama administration. The letter says Aetnas withdraw from Obama exchanges is directly linked to the Department of Justice’s move to disapprove the company’s merger with Humana.
The announcement late Monday came just weeks after Humana also said they would also cut their coverage plans for 2017.
Dwindling insurer participation is becoming a concern for Obamacare, especially for rural markets, in part because competition is supposedly what will control insurance price hikes, and many carriers have already announced plans to seek around 10 percent or more in price increases again in 2017.
This Obamacare disaster “is really going to be felt in Southern states and rural areas,” said Cynthia Cox, associate director of health reform and private insurance for the Kaiser Family Foundation, which studies health care issues.
The Kaiser Family Foundation estimated earlier this year that about one in five U.S. counties could be down to one health insurer on their public exchanges for next year, and about 70 percent of those markets will be rural. That was before Aetna announced its changes. Cox said the total may be closer to one in four now.
Rural markets can be less attractive to insurers because there are fewer customers for insurers to spread costs across, and hospitals and other health care providers can build dominating market positions, making them better able to negotiate rates. In contrast, urban markets, where most people live, are expected to still have plenty of health insurance choices on their exchanges for 2017.
Alabama, Alaska and Oklahoma are among the states that will have one health insurer selling individual coverage on their exchanges next year. South Carolina and most of North Carolina could join that list due to the Aetna decision, Cox noted.
The Associated Press contributed to this article