By Kendra Brown for BiolawToday.org
In the wake of Cigna and United Health Care exiting the national healthcare market, on August 24, 2016, Humana announced that it would leave the individual marketplace in Utah.[1] Now, Utah residents and employers have only three insurance companies to choose from: SelectHealth, Molina, and University of Utah Health Plan. SelectHealth remains the sole option for residents in 20 of Utah’s 29 counties.[2]
Though this may seem like a blow to the Affordable Care Act and Utah’s healthcare marketplace, all hope is not lost. In fact, Humana’s decision to leave the market is beneficial to the Utah healthcare industry. Humana covered only about 5% of Utahans in the federal marketplace, and was an option available only to employers.[3] Jason Stevenson at the Utah Health Policy Project explained to the Deseret News that Humana’s decision to leave “is a sign of a competitive marketplace.”[4]
For example, SelectHealth insurance is a local business.[5] For the last thirty years SelectHealth, a part of Intermountain Healthcare, has worked to provide health insurance at affordable costs across the state of Utah and Idaho.[6] The University of Utah Health Plan, established in 1998,[7] has become a more prevalent participant in the healthcare market with plans to continue expanding across the state to give residents more options for insurance plans.[8] Finally, Molina Healthcare does participate in the market in numerous states, but focuses primarily on low-income households and has had a growing presence in Utah.[9] Molina has created insurance programs that act similarly to Medicaid, which provides coverage to individuals and families who would otherwise not have insurance.
On the other hand, Humana is a national insurance company with different targeted goals and less of a competitive edge in Utah. Before the ACA was enacted, insurance companies primarily conducted business by “keeping all the sick people out and letting all the healthy people in.”[10] Now, the ACA has opened the umbrella to cover more people, including those who are less wealthy yet sicker, which has resulted in insurance companies “paying the price for fixing that legacy.”[11] Humana, as a national provider, is arguably less concerned about including more individuals in their healthcare plans and more interested in the financial gains for covering healthy individuals who can afford to pay for pricey healthcare plans without needing to use them for major healthcare services. For now, insurance providers are running a business and need to earn a profit. There is less concern about the people who are or are not covered; what matters is who can pay for it.
Now that Humana, Cigna, Aetna, and United Healthcare are no longer an option to employers purchasing plans from the federal marketplace, SelectHealth, University of Utah Health Plan, and Molina Healthcare will have room to expand in Utah. The employers that purchased healthcare plans for their employees from Humana can look at purchasing coverage from the local insurance providers. This could help our “robust market”[12] and state economy. When more people purchase plans from local providers there is more money pushed into our local economy and local healthcare marketplace, and this affords the opportunity for greater access to healthcare for Utahans. SelectHealth, University of Utah Health Plan, and Molina are primarily focused on the local economy and local consumers, rather than comparing their profits to the national marketplace and other state economies. There is less pressure for these primarily local providers than the national providers, who need to show that their insurance plans are producing similar net profits in every state that purchase plans from their company.
Kendra is currently a third year student at the S.J. Quinney College of Law and is a member of the Utah Law Review as well as the Student Director for the Medical-Legal Clinic. Kendra graduated from the University of Utah in 2009 with a B.A. in History after transferring from Colorado State University. Kendra loves to travel, scuba dive, and play soccer.
[1] Daphne Chen, Another Blow to Health Care as Humana Exits Utah in the Individual Marketplace, Deseret news (Aug. 24, 2016), http://www.deseretnews.com/article/865660943/Another-blow-to-health-care-as-Humana-exits-Utah-individual-marketplace.html?pg=all. Humana declined to comment on this decision to leave Utah following it’s precedent not to disclose information regarding its healthcare plans.
[2] Id.; Alex Stuckey, Humana Leaving Health Insurance Marketplace, Salt Lake Tribune (Aug. 25, 2016), http://www.sltrib.com/news/4278864-155/humana-leaving-utah-health-insurance-marketplace.
[3] Id.
[4] Daphne Chen, Another Blow to Health Care as Humana Exits Utah in the Individual Marketplace, Deseret news (Aug. 24, 2016), http://www.deseretnews.com/article/865660943/Another-blow-to-health-care-as-Humana-exits-Utah-individual-marketplace.html?pg=all
[5] Id.
[6] About Us, SelectHealth (last visited Aug. 29, 2016), http://selecthealth.org/about/Pages/home.aspx.
[7] About University of Utah Health Plans, University of Utah Health Plans (last visited Aug. 29, 2016), http://uhealthplan.utah.edu/about-us.php
[8] Daphne Chen, Another Blow to Health Care as Humana Exits Utah in the Individual Marketplace, Deseret news (Aug. 24, 2016), http://www.deseretnews.com/article/865660943/Another-blow-to-health-care-as-Humana-exits-Utah-individual-marketplace.html?pg=all; Alex Stuckey, Humana Leaving Health Insurance Marketplace, Salt Lake Tribune (Aug. 25, 2016), http://www.sltrib.com/news/4278864-155/humana-leaving-utah-health-insurance-marketplace.
[9] About Us, Molina Healthcare (last visited Aug. 29, 2016), http://www.molinahealthcare.com/members/common/en-US/abtmolina/compinfo/Pages/aboutus.aspx
[10] Daphne Chen, Another Blow to Health Care as Humana Exits Utah in the Individual Marketplace, Deseret news (Aug. 24, 2016), http://www.deseretnews.com/article/865660943/Another-blow-to-health-care-as-Humana-exits-Utah-individual-marketplace.html?pg=all
[11] Id.
[12] Id.