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Does Aetna love Obamacare or hate it?

at 03:39 PM ET, 06/14/2012

On Monday, health insurance giant Aetna volunteered to continue some of the Affordable Care Act’s benefits even if the Supreme Court strikes the law down.

On Thursday, Aetna accidentally revealed that it had made $7 million in donations to two major groups that oppose the health reform law — the American Action Network and the Chamber of Commerce.

It feels a little schizophrenic: One of America’s largest insurance companies is electing to carry out a law it might not have to, while sending money to groups aiming to take that same law down. But the revelation seems to nicely capture the health insurance industry’s love-hate relationship with the Affordable Care Act.

There’s one big thing health insurance companies like in the Affordable Care Act: the expansion of the private insurance market. The Congressional Budget Office estimates that, by 2019, 16 million Americans will gain private health insurance coverage. For health insurance plans, that’s 16 million new customers, many of whom are required by law (thanks to the individual mandate) to purchase their products. Not too shabby.

But here’s the big part they don’t like: The health reform law requires insurance companies to accept anyone who applies. In 2014, they can no longer turn down customers with preexisting conditions, as they often do now.

That means that insurance companies will have to accept sick customers with more expensive health-care needs. Those are the subscribers who tend to drive up the cost of health insurance, scaring away healthy consumers looking for a cheaper premium.

The Obama administration has certainly won praise from the health insurance industry for expanding coverage. All along, however, America’s Health Insurance Plans — the trade group that represents 1,300 health plans — has issued warnings about the Affordable Care Act’s potential to “raise costs and disrupt coverage.”

The insurance industry stands to gain if the law stands — and if it falls. In a world where the Affordable Care Act exists, upheld by the Supreme Court as constitutional, health insurers’ business expands. To that end, plans have looked to increase their retail presence and improve their public image (which might explain Monday’s offer to cover preventive health care at no cost).

There’s also the possibility that the Supreme Court undoes Obamacare’s individual mandate sometime in the next two weeks. If that happens, you can bet health insurers will be lobbying to make sure that other big parts of the law — namely, the guaranteed issue provisions — are dismantled as well.

So does Aetna love the law or hate it? The answer, right now, looks to be a bit of both. It depends on what part of the law you’re looking at. In a piece of legislation well over 2,000 pages long, there’s a lot for the industry to embrace — and to hold at arm’s distance.

 
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