David Cordani, the president of Cigna Corp., said today that his company will decide in the spring whether to offer U.S. individual major medical coverage in 2018.
The Bloomfield, Connecticut-based company is now selling individual coverage through the Affordable Care Act public exchange system in seven states, and it says its current enrollment is about 100,000 higher than it was a year ago.
Cordani said during a conference call with securities analysts that the company believes the current individual market is “fragile, at best.”
Under the current ACA individual market rules, an issuer can be successful only if a plan has tightly managed, high-value providers, Cordani said.
Cordani noted that, although Cigna has concerns about the effects of the ACA on the individual market, the company believes the law has done some good, by encouraging employers to adopt wellness and employee engagement programs, and by encouraging employers and Medicare Advantage to try to pay more for higher-value care and less for lower-value care.
How Cigna did
Cigna held the call to discuss its fourth-quarter earnings. The company is reporting $382 million in net income for the quarter on $9.9 billion in revenue, compared with $426 million in net income on $9.6 billion in revenue for the fourth quarter of 2015.
The company ended the year providing or administering health coverage for 15.2 million people, up from 15 million a year earlier.
The biggest revenue gains came at the stop-loss unit. Premium revenue there rose 13 percent, year-over-year, to $796 million.
Cigna faced marketing restrictions at its Medicare Part D plan business because of a dispute with Medicare program regulators. Revenue there fell 30 percent, to $244 million.
Cigna sells health coverage aimed at people who live and work outside the United States as well as coverage for people in the United States. International health care premium revenue rose 1 percent, to $462 million.
Cordani said during the conference call that the problems facing the ACA public exchange plan market are mostly the same issues facing health care systems around the world.
“Aging populations, eroding health status and the rise of chronic conditions all pose challenges,” Cordani said.
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