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Anthem, one of the country’s big five public health insurers, announced that it is pulling out of Ohio’s Affordable Care Act individual insurance marketplace for the 2018 plan year on Tuesday.
The move will leave between 18 and 20 counties in the state with no ACA, also known as Obamacare, insurer for 2018 depending on other insurers’ plans.
The Ohio counties joined a large swath of eastern Missouri that lost coverage after the exit of Blue Cross Blue Shield Kansas City in May.
While this is certainly concerning for Ohio’s ACA exchanges, it could also represent the opening of the floodgates for bad news for the rest of the country’s markets.
An exchange with no insurer is a seriously worrying prospect for any insurance market. People on the exchange currently would likely lose their coverage next year if no other insurer steps in. While it is likely they would not have to pay the ACA’s tax penalty, these people would not see the benefits of coverage.
The Anthem exit in Ohio is especially worrying, however, given the massive swath of the country in which it is the sole insurer in the exchanges, according to Cynthia Cox, associate director at nonpartisan health policy think tank The Kaiser Family Foundation.
“Anthem’s exit from Ohio could be the tip of the iceberg,” Cox told Business Insider on Tuesday. “Their reasons for leaving don’t appear to be specific to Ohio, rather about political and regulatory uncertainty coming from the White House and Congress. If Anthem leaves the market nationally, there could be hundreds of thousands of people without any exchange insurer.”
In a statement to Business Insider, Anthem cited a number of uncertainties that could impact the market coming from the Trump administration and Congress.
“The individual market remains volatile and the lack of certainty of funding for cost sharing reduction subsidies, the restoration of taxes on fully insured coverage and, an increasing lack of overall predictability simply does not provide a sustainable path forward to provide affordable plan choices for consumers,” said the statement.
Given Anthem’s political worries, there is a strong possibility the insurer could pull out of the other 13 states where they provide exchange plans if issues aren’t resolved in Washington by the time the company has to submit its 2018 plans in late June.
For many of these states, this could leave areas with no insurers, triggering the worst case scenario for large swaths of the country. For example, Anthem remains the only insurer in 72 counties in Missouri and if the insurer decides to pull out, this could leave as many as 100,000 people without an insurer, according to Cox. Anthem also represents the final choice for consumers in Georgia, Colorado, Kentucky, Virginia, Nevada, and possibly Iowa.
Looking beyond just Anthem, the move also represents a worrying trend for Blue Cross Blue Shield plans nationwide. Anthem is the largest operator of these plans, but independent BCBS companies operate in all 50 states and, according to Cox, are the last insurer in many places. If the Anthem exit in Ohio and the BCBS Kansas City exit in Missouri are just the first in a wave of exits for BCBS insurers, it could be devastating for the market.
While Anthem has not laid out plans for these markets for 2018, and there are still a few weeks before the company and other insurers have to have their plans locked in place, the Ohio exit is concerning.