Public Payers News

More Payers Will Join ACA Health Insurance Marketplace In 2020

2020 will see 13 percent fewer bare counties and a continued rise in Medicaid MCOs in the federal health insurance marketplace.

managed care organizations, federal health insurance marketplace, healthcare payer, Medicaid, Affordable Care Act

Source: Getty Images

By Kelsey Waddill

- After seven years of instability and decreasing involvement from payers, the Affordable Care Act exchanges, or the federal health insurance marketplace, will expand in 2020, the Robert Wood Johnson Foundation (RWJF) predicted.

“Stability has not been a major theme in the story of the Affordable Care Act marketplace, but since 2018, premium growth has slowed and issuer participation has increased,” RWJF summarized in a statement. “While enrollment has trended down somewhat in recent years, health plans seem newly interested in participating.”

Specifically, Centene, Oscar, and Bright Health are expected to expand immensely. The Blue plans, Cigna, and Anthem have also staked out new areas to offer Affordable Care Act health plans.

Last year, many counties were in danger of going “bare” in the federal health insurance marketplace, with only a single healthcare payer available in the region. In 2020, the number of bare counties will drop by 13 percent. The percentage could be higher based on the extent of payers’ expansions.

Blue and regional payers have remained consistent players on the federal marketplace since 2015, almost as long as the Affordable Care Act has been in effect. They will continue to be a presence in 2020.

In contrast, Affordable Care Act Consumer Operated and Oriented Plans (CO-OPs) are not showing signs of resurrection in 2020.

Meanwhile, major payers remain tentative about returning to the federal health insurance marketplace. The largest single issuer in the federal health insurance marketplace, Centene, ranked sixth among the nation’s largest insurers in 2018 with 12.2 million members. Centene plans to grow, having just received stockholder approval to acquire WellCare.

Anthem is on the marketplace but has not yet overtaken Centene despite being the second largest plan in the nation. Nevertheless, UnitedHealth Group, Humana, and Aetna--the first, third, and fifth largest payers in the nation--will stay out of the marketplace again in 2020.

Medicaid managed care organizations (MCOs) are the only healthcare payers that are not just making a resurgence but adding onto previous years’ strong performance.

According to the RWJ Foundation article, in 2018 when the federal health insurance marketplace hit an all-time low, it was Medicaid MCOs that kept the marketplace afloat.

Healthcare payers were fleeing the federal health insurance marketplace, counties were going bare, and premiums were climbing. The main two factors in the federal health insurance marketplace’s instability, according to RWJF, have been over-entry and under-pricing. Uncertainty regarding the future of the Affordable Care Act and other regulations also fueled the 2017 and 2018 damage to the federal health insurance marketplace.

But Medicaid MCOs led the way in expansions in 2018, filling the gaps left behind by major payers. In 2019, they continued to extend their reach in the federal health insurance marketplace.

Apart from Medicaid MCOs, payers are re-entering as well in 2019. According to the RWJF, the larger margins are attracting healthcare payers back into the federal health insurance marketplace.

For example, Oscar Health, after re-entering in 2018, expanded its health plan’s presence in the marketplace for 2019.

Bright Health, which recently expanded its venture-funded Medicare Advantage plan, also broadened its marketplace footprint in 2019.

Most recently, Cigna announced that it would be expanding its reach in the federal health insurance marketplace. The major payer will be expanding into 19 new markets in 10 states.

Cigna, which has been using its recent industry consolidation to control the out-of-pocket costs, plans to help beneficiaries on the new plans to control their personal healthcare spending through $0 preventive care, free telehealth services, low-cost options for chronic disease management and other options.

“More people who purchase health care coverage on the exchange now will have access to Cigna’s broad range of products and services that makes quality health care more accessible and affordable,” said Brian Evanko, president of Cigna's government business. “We’ve learned from our thoughtful approach and continuous presence on the exchange how to deliver a great product with a simplified customer experience. We are proud to be able to deliver our exceptional offering to even more people throughout the U.S.”