Cigna adds to insurers’ pressure on lawmakers for Obamacare fixes

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By Caroline Humer

<span class="articleLocation”>Health insurer Cigna Corp on Thursday
added to growing public pressure on Republican lawmakers and the
Trump administration to stabilize the Obamacare individual
market or risk insurers pulling out.

Cigna Chief Executive Officer David Cordani described the
three-year-old market as “fragile at best,” echoing concerns of
top executives at Aetna Inc and Anthem Corp who
said earlier this week they need tighter enrollment rules and
requirements to create a better balance of healthy and sick

Cigna shares fell 1.2 percent to $145.86.

Republicans and President Donald Trump have promised not to
pull the rug out from under Americans who were newly insured
under President Barack Obama’s healthcare reform law, even as
they seek to “repeal and replace” the law as soon as possible.

Lawmakers have not agreed on a plan for new individual
products that would replace the Obamacare coverage, although
some have started to talk about a rescue package that could fix
the market.

If insurers drop out, that would lead to less competition
and probably more premium rate increases in 2018. Premiums rose
about 25 percent in 2017. The Affordable Care Act, or Obamacare,
has not delivered its promise, Aetna CEO Mark Bertolini said
earlier this week.

“The health insurance industry is really tight with
Republicans and have a lot of influence on what’s going on,”
Leerink Partners analyst Ana Gupte said.

“They are saying we won’t participate in 2018 if you don’t
do this, this and that, but it’s a negotiation and the GOP is
going to be very receptive to what they want. The last thing
they need is a big disruption in the market.”

The various parties face a tight timetable. Cordani and
other insurer CEOs need to decide in the next few months if they
are going to prepare plans to submit to regulators before the
April and May deadlines for 2018 plans.

Cigna, which offers plans in seven states, will “fully
assess whether we will participate, where, and how,” Cordani
told investors during a conference call to discuss its
better-than-expected fourth-quarter earnings.

Cigna, which manages large corporate and government health
plans and has a small individual insurance business, said it is
waiting for a ruling on the U.S. government’s lawsuit to block
its acquisition by Anthem. It declined to answer analysts’
questions about its capital deployment plans such as buybacks.

Individual insurance created by former President Barack
Obama’s health reform law has been a difficult business for
large insurers. Cordani said the company has lost money each of
the last three years, and expects to lose money this year,
though less than in 2016. (Additional reporting by Ankur Banerjee)

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