SAN FRANCISCO — Aetna chief executive Mark Bertolini spoke Wednesday at the J.P. Morgan Health Care Conference — and he had a lot to say about the health-care law's rollout.
1. The early exchange demographics are actually better than expected. Bertolini's take on the age-breakdown of marketplace enrollees was really interesting — and different from the reaction in Washington. While most of us journalists pointed out that the Obama administration is falling short of its young adult enrollment target, that doesn't really matter to Aetna. What matters to a health plan is who they expected to sign-up, and what type of age mixed they used to set their premium prices.
"Given the general demographics that CMS released yesterday, I'm not alarmed," Bertolini says. "They're better than I thought they would have been."
This is, incidentally, an idea that other insurance executives brought up this week: They don't really care what goal the White House set for young adults. What matters to them — and what will determine if rates need to increase next year — is who they expected to sign up.
“Things aren’t necessarily way out of whack with our expectations,” Wellpoint's chief financial officer Wayne DeVeydt said at a separate presentation. “It’s not about whether or not you're getting a sicker book. It’s whether you priced for it.”
2. Many enrollees still haven't paid their insurance premiums. Bertolini estimates that, as of Jan. 15, a significant number of exchange enrollees have not made a premium payment. "The 50-70 percent range people who paid is a good ballpark," he says.
(Update: An Aetna spokesperson clarified that Bertolini's comments were meant to refer to the entire exchange population, not just Aetna's enrollees. Aetna, according to their spokesperson, has had over 70 percent of exchange enrollees pay their first month's premium).
This is another reason why you don't hear Aetna or other insurers panicking about the rocky rollout of Obamacare as much as you might expect. "It doesn't have a material impact on our business," he says, "But it gives us the opportunity to play across a spectrum of products."
4. ... But it's going to get big later. Bertolini predicts that 75 million Americans will purchase their health coverage through an exchange by 2020.
"In a system where you have two, three or four choices people are chronically overinsured or underinsured," Bertolini says. The idea with an exchange is shoppers would have an incentive to choose a less costly plan if they felt like they didn't need it — namely, that their employer was only putting in a set amount of money regardless of how expensive the plan premium was.
KLIFF NOTES: Top health policy reads from around the Web.
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