Tony Leys

tleys@dmreg.com

A second major health-insurer has decided to quit selling individual policies in Iowa, raising fears that tens of thousands of Iowans will have no options for coverage next year.

Aetna informed Iowa regulators Thursday that it had decided to stop selling such policies, which cover people who lack access to employer-provided coverage or government plans. The move would affect 36,205 customers, the company told regulators.

Aetna’s move takes effect in January. It came three days after Iowa’s dominant health-insurer, Wellmark Blue Cross & Blue Shield, announced that it would no longer sell individual health-insurance policies in Iowa. Only one other insurer, the relatively small Minnesota carrier Medica, currently sells individual policies in most Iowa counties. Medica has declined to say if it intends to continue selling such policies here for 2018. "We are currently evaluating the situation and our options," spokesman Greg Bury said Thursday. If Medica pulls out, many Iowans could have no options for individual coverage, either on or off the Affordable Care Act's "exchange" marketplace.

An Aetna spokesman said in a statement that the decision was “a result of financial risk and an uncertain outlook for the marketplace.”

Aetna’s brief statement didn’t detail its reasons. But the national carrier already had stopped selling such policies in 11 other states for 2017, citing turmoil in the wake of the Affordable Care Act.

Wellmark cited similar reasons, plus the inability of Republicans controlling Congress to replace the Affordable Care Act with a plan that could provide more stability for the market.

Many of Aetna’s individual Iowa customers were originally on plans sold by the carrier Coventry, which Aetna bought in 2013. The Aetna and Wellmark decisions to leave the individual-insurance market here don’t affect other kinds of insurance plans, such as those sold via employers or those that supplement Medicare plans. Aetna said Thursday it had not decided whether to pull out of the three remaining states — Delaware, Nebraska and Virginia — where it sells individual health-insurance policies. The company announced last year that it would no longer sell such policies in 11 other states.

The Aetna and Wellmark decisions will sharply curtail choices for Iowans who want to buy insurance plans that could qualify for federal subsidies under the Affordable Care Act. As things stand now, Medica could be the only choice for most such Iowans for 2018. If that company pulls out and no new carrier comes in, most Iowans could be without options for policies that qualify for the subsidies.

Iowa Insurance Commissioner Doug Ommen said he is worried that no carriers will want to offer individual health policies in Iowa for next year. “It’s a very difficult and unstable market,” he said.

Insurers have complained that the Affordable Care Act, also known as Obamacare, put them in a difficult spot. The 2010 law bars insurers from denying coverage to people with pre-existing conditions. It also requires most Americans to obtain coverage or pay a penalty, but insurance industry leaders say that requirement has not been strictly enforced. The result is too many young, healthy people are staying out of the pool, leaving insurers to cover mostly older, unhealthy people, the carriers say. Wellmark’s leader said this week that the problem will likely get worse because President Donald Trump has told his administrators to stop enforcing the coverage requirement.

Ommen, who was recently appointed by Republican Gov. Terry Branstad, said he understands the companies’ position. He said his office is hamstrung by the Affordable Care Act in how it can respond. “Without congressional action, we’re very limited in what we can do,” he said. “This is a federally created situation, and we need a federally created solution.”

Aetna customer Debbie Neustadt of Des Moines was stunned to learn Thursday that not only will she lose her current policy on Jan. 1, she might not have any other options for individual coverage. “What a crock!” she said.

At one point, Neustadt went several years without health insurance. Now, at age 62, she might have to do it again.

Neustadt, who works for a retail store, gets an Obamacare subsidy that helps her pay the premium on her Aetna policy. She said she hopes in the short run, Congress strengthens penalties for healthy people who fail to obtain coverage. “All along, I’ve said this shouldn’t be a political football. This is people’s health — it’s people’s lives,” she said. In the long run, she said, the country should set up a single-payer, public program, like many other countries have.

Cheryl Bose of Ankeny also could be among the Iowa customers cast adrift without insurance. Bose, who is a semi-retired accountant, stands to lose her Wellmark policy in January, along with similar policies she buys for her two children in their 20s. She doesn’t know what she’ll do, but she predicted Thursday the situation will put strong pressure on Congress to pass at least a temporary fix.

Bose said she won’t join other customers in venting anger at the insurers over the collapse of the market. “It’s a problem that has a lot of moving parts. It’s not the insurance companies’ fault, exactly,” she said.

The main problem seems to be that under the Affordable Care Act, too many people have been able to delay obtaining insurance until they become ill, she said. They buy policies, obtain expensive care, and then cancel their coverage. The insurers can’t keep losing countless dollars under that scenario, she said.

Like Neustadt, Bose believes the country eventually should shift to a national health-care plan. Everyone would pay taxes into it, and everyone would share risks, she said. In the meantime, she said, Congress will have to pass something to help people like her. However, she worries that the currently deadlocked Congress won’t be able to move quickly enough to provide a fix for 2018.

Mary Nelle Trefz, an analyst with the Child and Family Policy Center in Des Moines, said Trump made the insurance markets even less stable by boasting that he expected Obamacare to “explode” after Congress was unable to pass a replacement plan.

Trefz, whose private group generally supports Obamacare, said the president’s words probably made insurers even more uncertain about the future. “It’s clear that the Trump administration and the GOP want to undo the ACA,” she said. “It’s kind of a self-fulfilling prophecy.”

The Register asked the offices of Iowa’s four U.S. representatives and two senators whether they thought Congress could act to provide interim options for Iowans who stand to lose coverage in 2018.

Rep. David Young, a Republican who opposed his own party’s proposed Obamacare replacement plan last month, said the insurers’ impending exits from the Iowa individual insurance market should add urgency to the discussions.

“Unfortunately, we’re seeing some of the devastating effects of the Affordable Care Act with the news of the past five days highlighting the need for a thoughtful and deliberate new approach to ensuring patients have access to quality and affordable health care that works for all Iowans — not just some,” Young wrote.

Rep. Dave Loebsack, the delegation’s sole Democrat, said he is open to discussions on how to improve the Affordable Care Act. “However, that is not what is happening right now,” Loebsack wrote in a statement released by his office. “The Republicans’ calls for repeal without a clear plan have created needless uncertainty for providers, insurers and Iowans alike.”

Sen. Chuck Grassley said in a statement that Thursday's news “emphasizes the need to fix the law. Costs are increasing and access is decreasing. Today I’m also hearing from Senate Democrats for the first time wanting to discuss Obamacare. This is a good development because, like I said the day the House vote was pulled, a bipartisan approach is the best way to make policy that’s as sweeping as health care policy.”