Now that several states have released the names of the insurers that will submit plans to sell on their health insurance exchanges, industry analysts received their biggest clue as to whether big insurers would jump headfirst into the online marketplaces, Bloomberg reported.
"The industry is backing off," Sarah James, a Wedbush Securities analyst in Los Angeles told Bloomberg. "They'd much rather wait and observe the environment for the first year or two."
In California, for example, UnitedHealth, Aetna and Cigna were missing from the group of insurers intending to sell plans on its exchange, one of the largest in the country.
UnitedHealth is taking a conservative approach to the marketplaces because CEO Stephen Hemsley is concerned the new consumers may be the costliest, he said during the Sanford C. Bernstein & Co. conference, according to Bloomberg.
The nation's largest insurer will "watch and see" how the exchanges evolve, particularly whether the first enrollees have "a pent-up appetite" for medical care, Hemsley said. "We are approaching [exchanges] with some degree of caution because of that."
Bob Laszewski, president of Health Policy and Strategy Associates, told California Healthline that UnitedHealth and other insurers are taking predictable precautions. "It's absolutely no surprise" some insurers are sitting out of exchanges, particularly since "growth in the exchanges [is expected] to be very slow. There's not a big upside to being in on Day 1."