Insurers set to see first-time profits from ACA plans: 6 things to know

Many insurers are slated to have their best financial year to date under the ACA, according to a Politico analysis.

For the analysis, the publication examined 31 regional Blue Cross Blue Shield plans.

Here are six things to know.

1. The analysis comes as insurers substantially increased premiums for 2017 plans by an average of more than 20 percent. It also comes amid Republican efforts to repeal the ACA's individual insurance mandate.

2. During the first nine months of 2017, insurers spent an average of 78 percent of premium revenues on customers' medical claims, the analysis found, according to Politico. The publication notes this percentage is "well ahead of the 85 percent threshold that's typically viewed as a rough break-even point for carriers doing business in the individual market" as well as "far better than health plans have fared in prior years under" the ACA.

3. Politico provides multiple individual examples of this trend. For instance, the report states the Health Care Service Corp., an independent licensee of the Blue Cross and Blue Shield Association, with 1.2 million individual market customers in Illinois, Montana, New Mexico, Oklahoma and Texas, spent 70 percent of premium revenues on medical costs through the first three quarters of 2017, compared to nearly 90 percent last year through September.

4. The analysis overall found 26 of the 31 regional plans examined have improved operating margins through the first three quarters of 2017 compared to same period of the two prior years, according to Politico.

5. In total, the report states, the 31 studied regional plans had 4.6 million individual market customers when September ended, and their premiums came to a combined $22.2 billion.

6. But Politico notes insurers could lose financial steam in the final quarter of 2017 as customers use all of their deductibles.

Read the full Politico report here.

 

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UnitedHealthcare unveils value-based Medicare Advantage program with Oak Street Health
Fitch: CVS Health-Aetna 'prime example' of healthcare's focus on pricing power

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