This summer, Aetna Life Insurance notified many D.C. users know that their purchased health plans would expire permanently at the end of the year.
According to a Washington Post report, Aetna’s involvement in the capital’s health exchange, DC Health Link, will terminate at the end of 2015, along with all of the plans purchased by the city’s residents. Along with CareFirst, the region’s largest insurance carrier, Aetna offers plans known as Preferred Provider Organizations, or PPOs, that allow residents to more freely choose their hospitals and doctors.
Fewer Options, Less Flexibility
Aetna’s termination of their DC Health Link services will leave the city with CareFirst as the only provider of PPOs and reduce the total number of available health plans to 162, roughly half of what the exchange is now. These changes are particularly concerning for residents who are self-employed, under-employed, or retired workers, who must purchase their own insurance and may not be able to find a comparable plan following the cut. More than 23,000 people purchase individual plans on the marketplace.
In a letter Aetna is distributing to subscribers, the company claims it, “determined we can no longer meet the needs of our customers while remaining competitive in the market.” The director of the exchange, Mila Kofman, insists that the change will not negatively impact those in the region, nor that the change is indicative of any problems with the city’s marketplace.
On the contrary, Kofman says the decrease in plans shows that carriers have a better sense of the market and what residents want. “When you have products when there’s not a whole lot of interest to buy, that’s the market telling the carrier what they are selling, people can’t afford. So in terms of competition, it’s not a loss,” she said.
Despite the change, Aetna will continue to offer plans through employers, including Congress, so lawmakers and their staff — approximately 81 percent of people who buy insurance using the exchange through their employers — will not be affected.
A Rise in Price
Following Aetna’s announcement, CareFirst has proposed increasing the rate of its PPO plans from 3 percent to over 17 percent, as townhall.com reports. Since the average increase across the nation has been around 7 percent, industry analysts say CareFirst’s hike is only moderate.
Robert Laszewski, a healthcare consultant in Virginia, cites the District’s size and heavy regulation as major problems for its unattractive healthcare market. “The District has never been thought of as an attractive market. It’s not a state — it’s one city, one moderate-sized city, and it’s also known for extreme regulation,” he said.
“When you have a small market that gives a lot of regulatory trouble, for insurers, it’s like, why bother?” Laszewski points out that the size of DC makes it difficult for companies like Aetna to provide adequate insurance for those who are not federal employees.
Such uncertainty, not to mention the complexity of the market, makes alternative solutions to healthcare crucial for thousands of Americans. SingleCare offers such a solution, providing members with affordable and on-demand care options. No premiums, no deductibles — simply pay for the treatment you receive, with the doctor you want. For the many Washingtonians who struggle to find care, SingleCare is a simple and valuable solution to a complicated and costly problem.
(Main image credit: f11photo/Thinkstock)