Aetna's Mark Bertolini: Individual markets in 'death spiral'

Though Aetna has not yet decided whether to leave the Affordable Care Act exchanges entirely in 2018, the marketplaces are in a “death spiral” and will likely see exits from other insurers, Aetna CEO Mark Bertolini said on Wednesday.

Speaking at the Wall Street Journal’s Future of Healthcare event, Bertolini said Humana’s recently announced decision to leave the exchanges in 2018 is indicative of the troubled nature of the individual market.

“That logic shows how much the risk pool is deteriorating in the ACA, and how poorly structured the funding mechanism and premium model is,” he said. “I think you will see a lot more withdrawals this year.”

The way Bertolini describes it, the marketplaces are stuck in a vicious cycle in which the population is getting riskier and premiums are going up to compensate, which drives healthy people away from the exchanges and worsens the overall risk pool. “It is in a death spiral,” he said.

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Bertolini also responded to the rebuke he received from a federal judge in the opinion striking down the Aetna-Humana merger, in which the judge wrote that Aetna withdrew from some exchange markets in 2017 “specifically to evade judicial scrutiny of the merger.”

“I had 450 million reasons last year why we should have been out of the exchanges,” Bertolini said, referencing the $450 million that the insurer said it lost on its ACA-compliant products last year.

Bertolini has already said that next year the insurer will not re-enter the markets that it exited in 2017. Still, Aetna has not yet determined whether to exit the four states where it remains, Bertolini said Wednesday.

Anthem is also still weighing whether to participate in the exchanges next year, CEO Joseph Swedish said on the company’s recent earnings call. Similarly, Cigna CEO David Cordani said that “we will fully assess whether we participate, where and how, as we get through the spring cycle.”