In a conference call with investors in April, Aetna CEO Mark Bertolini was upbeat about Obamacare, saying the company was in a “good place to make this a sustainable program.” Four months later Aetna — the third largest insurer in the program — announced it would largely withdraw from the health insurance exchanges. This time Bertolini said the second quarter had been rough, with “individuals in need of high-cost care” representing a “larger share” of those it insured though the Obamacare exchanges. This and other factors created “significant sustainability concerns” for Aetna.
That’s a swift turnabout in just four months, right? Especially for an insurance company whose chief business is calculating future risk and liability. Huffpost reporters Jonathan Cohn and Jeffrey Young believe they have an explanation, in the form of a July letter they surfaced from Aetna to the US Department of Justice, which is seeking to block the merger of Aetna with Humana. The letter clearly states that if the deal were threatened, Aetna would reduce its “exchange footprint.” Later it says that if the deal is “ultimately blocked” we would “need to leave the public exchange business entirely.”
From the Aetna letter: “Our analysis to date makes clear that if the deal were challenged and/or blocked we would need to take immediate actions to mitigate public exchange and ACA small group losses. Specifically, if the DOJ sues to enjoin the transaction, we will immediately take action to reduce our 2017 exchange footprint.”