|
 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 customers.
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.
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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.
(Reporting by Caroline Humer in New York; Additional reporting by
Ankur Banerjee in Bengaluru; Editing by Martina D'Couto and Jeffrey
Benkoe)
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