Health Insurance Exchanges:
Aetna's Key Principles

The issue

Aetna believes implementation of exchanges should be guided by ensuring consumers have affordable products and have choices that meet their needs related to family status and preference.  Exchanges should also make our health care system simpler for consumers and should not add bureaucratic complexity that can add to the cost of insurance. Our key principles are Affordability, Competition, and Simplicity.

Affordability

  • All Americans should have access to affordable high quality health care.
  • At a minimum, the Affordable Care Act’s (ACA) insurance rating and product design rules should be phased in, rather than confront consumers with costly “rate shock” if all of the new requirements come into play at once in 2014.
  • In order to provide affordable products, the solvency of insurance plans needs to be protected by maintaining a strong risk pool.  Safeguards needed are:

    o Set clear limits on open enrollment periods and disincentives to late enrollment;
    o Resist rating rules tighter than those the ACA already imposes (e.g., on age);
    o Keep the individual & small group markets distinct. A merger of markets could destabilize both -- e.g., the individual market usually carries more risk/higher costs, which would transfer to small group employers, thereby raising their costs.
  • Create greater market leeway for offering lower-cost plan options to consumers. The ACA-specified coverage categories of Platinum, Gold, Sliver, and Bronze will be out of reach for many.  The ACA will result in increased prices due to costly minimum benefit requirements, additional taxes, additional administrative complexity and medical loss ratio (MLR) requirements.

Competition

  • Assure availability of plans both on and off of the exchanges, and apply market rules equally in both settings to prevent destabilizing adverse selection. Plan designs and pricing should be comparable on and off exchanges.
  • Don’t limit consumer options by pre-determining plan designs or dictating prices.
  • Allow plans both on and off the exchanges and apply a level playing field to prevent adverse selection. Plan designs and pricing should be comparable on and off exchanges.
  • Consumers and employers should be able to keep what they have, and continue to purchase insurance through the same channels they use today, if they wish -- i.e., directly or via brokers.

Simplicity

  • Assure that an exchange’s technical standards conform to national or multi-state platforms.  One-off systems will face higher costs and deter plan participation.
  • Prevent exchanges (whether state-run or federally facilitated) from overlapping with existing state agencies in insurance regulation (e.g., responsibility for rate review). Plans should not have to comply with duplicate rules from exchanges.
  • Assure a truly effective “no wrong door” policy for consumers, and minimize disruptive “churning” of Medicaid enrollees in and out of exchanges. This can be helped by establishing continuous eligibility periods and/or comparable stabilizing mechanisms.
  • States should not discourage exchange participation by mandating that a single health plan must offer both a Medicaid product and an exchange commercial product.