The case of the $12M member: High-cost enrollee sheds light on health insurers' ACA exchange woes

stethoscope on money
It isn't a hemophilia patient's fault that he racks up $1 million in medical bills each month, according to Wellmark Blue Cross Blue Shield, but the insurer says those costs have to be spread out through a larger risk pool. (Getty/Maudib)

Wellmark Blue Cross Blue Shield is hardly the only payer to cite financial losses as the reason why it decided to leave the Affordable Care Act exchanges.

But Iowa’s largest health insurer is unique in that it can point to a specific member—a hemophiliac teenager who racks up more than $12 million in medical bills per year—as one of the driving forces behind its decision to exit the marketplace.

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Previously, Wellmark has pointed to the $12 million member as an example of spiking healthcare costs and used the case to explain why premiums were rising in the individual market, USA Today reports. During a recent presentation at the Des Moines Rotary Club, Wellmark Executive Vice President Laura Jackson revealed for the first time which genetic condition the patient has, though not his name or where he lives.

Even among hemophilia patients, who generally can require treatments that cost as much as $1 million per year, the Wellmark member’s case is an outlier, according to Katie Verb, director of policy and government relations for the Hemophilia Federation of America. 

Wellmark’s leaders told USA Today that it isn’t the patient’s fault he requires such expensive care, but they did note that the cost needs to be spread out through a larger risk pool. Currently, only 30,000 people are in Iowa’s individual market.

Since both Wellmark and Aetna have pulled out of the Iowa exchange next year, that leaves Medica facing the unenviable prospect of having to cover the pricey patient. Thus, it too might exit the marketplace, the article notes.

To spread out the costs for more expensive members, Medica has advocated creating a “virtual high-risk pool,” according to the Minneapolis Star Tribune. It also wants policymakers to create reinsurance programs to help cover the cost of expensive enrollees.

In addition to Iowa, Medica is also set to be the only insurer selling policies on the exchange in Nebraska next year, as well as in two large Kansas counties. Having those unwanted monopolies puts the company in a tough spot, experts told the publication.

"Insurers don't want to be the last one in the market," said Cynthia Cox, an associate director for the Kaiser Family Foundation. "It's almost like a game of hot potato—they're trying to avoid being the only health plan for high-cost enrollees."