Insurance behemoth Aetna announced late Monday that it is pulling out of Obamacare public exchanges in 11 states, citing projected financial losses because of the high number of people who—it turns out—need expensive medical care.
Following a string of similar announcements, advocates of single-payer healthcare say that these departures only underscore the fact that "big commercial insurance corporations" will always "put profits before patients' health."
In a statement, Aetna chairman and CEO Mark Bertolini said that the company is withdrawing from 70 percent of the Affordable Care Act (ACA) exchanges and will only remain in markets in Delaware, Iowa, Nebraska, and Virginia.
"Fifty-five percent of our individual on-exchange membership is new in 2016, and in the second quarter we saw individuals in need of high-cost care represent an even larger share of our on-exchange population," Bertolini stated. "This population dynamic, coupled with the current inadequate risk adjustment mechanism, results in substantial upward pressure on premiums and creates significant sustainability concerns."
To translate: "individuals in need of high-cost care" in this context really just means "sick people cost too much." Advocates have long-said that pitting financial risk against public health is one of the major pitfalls of for-profit health insurance.
"Aetna’s announcement proves the larger point that private insurance companies are willing to deny care to make a few extra dollars. It is further evidence of how badly we need a public option for all through Medicare in this country," declared Kait Sweeney, press secretary for the Progressive Change Campaign Committee (PCCC).
A single-payer system (also known as Medicare-for-All) would replace the current for-profit model with a government-run system that covers all Americans' medical needs. Such a plan was a pillar of Bernie Sanders' presidential campaign. A more incremental public option—killed off by Congress during the legislative battle over Obamacare—has now been endorsed by Democratic nominee Hillary Clinton.
"It is disappointing that Aetna has joined other large for-profit health insurance companies in pulling out of the insurance marketplace," the Senator from Vermont said Tuesday. "Despite the Affordable Care Act bringing them millions more paying customers than ever before, these companies are more concerned with making huge profits then ensuring access to health care for all Americans."
Sanders, who promised to re-introduce legislation creating a "Medicare-for-All" again next year, added: "The provision of health care cannot continue to be dependent upon the whims and market projections of large private insurance companies whose only goal is to make as much profit as possible."
Sweeney agreed, adding that the call for an alternate healthcare model "has new urgency at this moment. A public option is not only smart policy, but also a super popular economic populist issue that will help lead Democrats to victory in November—and it should be a priority for a new administration."
As Los Angeles Times columnist Michael Hiltzik noted last week—amid the first rumblings of Aetna's draw down—Congress and the Obama administration did the health insurance industry an "enormous favor in enacting the Affordable Care Act in 2010." Not only did they place Big Insurance at the "center of Obamacare ...they killed the public option," believing it to be a foot-in-the-door for single-payer.
He points out that health insurance companies at all levels are "reaping the benefits of Obamacare," and argues that alternately these "whining" insurers are likely seeking something. In Aetna's case, Hiltzik said it likely has to do with the fact that the U.S. Department of Justice is attempting to block its proposed $37-billion merger with Humana.
Sen. Elizabeth Warren (D-Mass.) expressed a similar hunch, writing on Facebook: "The health of the American people should not be used as bargaining chips to force the government to bend to one giant company's will."
And despite corporate media spin on the departures, Hiltzik concluded that "it's a mistake to view insurers' withdrawals from ACA exchanges as a sign that it's impossible to provide affordable health coverage to more Americans. It's more a sign that the fundamental error in the ACA's design was giving too much away to the insurance industry."
In a scathing op-ed published weeks before the official announcement, Wendell Potter, author of "Nation on the Take," said that it "disgusts" him that big for-profit health insurers are so blatantly demonstrating that "nothing—absolutely nothing—is more important to them than making their rich shareholders even richer. If that means making it more difficult for low- and middle-income Americans to get the medical care they need, so be it."
Breaking down how Aetna specifically has profited during President Obama's tenure, he wrote: "Between April 1, 2009, and today, Aetna's share price has increased 525%. Any interest among the shareholders to share some of that wealth with folks who are struggling to get the care they need? Are you crazy?"
As Richard Kirsch, former National Campaign Manager of Health Care For America Now and Senior Fellow at the Roosevelt Institute, said Tuesday, "Big commercial insurance corporations continue to put profits before patients' health, which is why Hillary Clinton's call for a public insurance option so that everyone in every exchange in the country has a choice of an affordable option is more essential than ever."