Remember Johnny Carson’s “Carnack the Magnificent” where he would don the outfit of a Vizier and predict the question to the answer he just provided? What a great and timeless shtick that only Carson could pull off. If “Carnack the Magnificent” were still around, he just might look at the demise of the Affordable Care Act and predict a great, funny one-liner. The one thing I can predict about the future of healthcare without the ACA is that health insurance companies are going to be very, very busy. It didn’t take a lot of imagination to develop insurance policies or underwriting standards with the ACA. After all, it was a follow-the-dots type of deal with the federal government. Follow the government mandates for coverage or else. So, we had government-mandated plans that were very expensive because they covered all health-related issues, from contraception and maternity to prostate exams for women.
The actions already taken by the House and Senate to replace the now-infamous Affordable Care Act show that this train is getting ready to roll faster than anyone imagined possible. What this means for health insurance companies is that they better be ready to roll equally fast.
Today, I read a short article about Cigna gearing up to sell individual health policies with varying coverages. Without the coverage mandates of the ACA, Cigna is already looking at selling policies that are slimmed down in coverage, resulting in a lower price. Movement on the individual side, with Cigna seeing double- or even triple-digit growth, is great news for people who don’t need all the coverage required in ACA insurance plans. For example, not everyone needs maternity coverage or policies with no lifetime caps on benefits. It looks like Cigna is ready and willing to start selling policies that people actually need and want, which is great news for the overall health insurance market. And if Cigna is priming its pump, so are dozens of other health insurance companies.
One of the big issues that proponents of the ACA are shouting about is pre-existing conditions. Those who are beating that drum know that the uninsurable population is relatively small. It isn’t “half the population” as I’ve heard them say. And getting them into the insurance pool isn’t that difficult. Yes, these are the people with costly medical issues, but they can be handled in a number of ways: outright grants of money to them, federal dollars to fund state chip plans, or putting those with uninsurable conditions directly into Medicare, as has been done with those on kidney dialysis. But overall, health insurance should be very much like automobile insurance where there are literally hundreds of insurance companies that are vying for people’s business. One innovation from the ACA (yes, there was actually some innovation) is the operation of health insurance exchanges. I’m not talking about the government or co-op run exchanges, but private exchanges. Aon-Hewitt is an example of a private exchange that operates with dozens of insurance companies that enable brokers to get the best in coverage for their clients (Truth in advertising, the AON Exchange uses VUE’s Compensation Module). I expect the private exchanges to continue in operation because, as Aon has proved, they work.
So as I put on my “Carnack the Magnificent” hat, here are a couple of answers to the question, what next? I envision Health Savings Accounts, the rise of a competitive health insurance market, health exchanges, doctors and patients on the same page, lower healthcare costs, and a clearly defined role for government involvement in healthcare. And maybe, just maybe, making health insurance more like it was intended to be: financial protection for sickness and accidents that are beyond the norm. Many are scared or concerned about the dismantling of the ACA, to them I say, “Don’t worry about a thing, because everything is gonna be alright”