500,000 Enrolled in WellPoint Plans Through ACA’s Exchanges
On Wednesday, WellPoint said it has enrolled 500,000 U.S. residents in plans it markets through the health insurance exchanges since open enrollment began on Oct. 1, 2013, the Los Angeles Times' "Money & Co." reports (Terhune, "Money & Co.," Los Angeles Times, 1/29).
WellPoint is the largest provider of individual health plans in the exchanges and is selling policies in 14 states, including California and New York (Wilde Mathews, Wall Street Journal, 1/29).
The insurer said about 80% of its enrollees were new customers, of which about two-thirds qualified for federal subsidies that are available to those with annual incomes up to 400% of the federal poverty line. The insurer said it has not yet determined how many of its new enrollees previously were uninsured (Demko, Modern Healthcare, 1/29).
The data showed that enrollees are commonly choosing the less-costly "silver" and "bronze" plans, as opposed to the more comprehensive "gold" or "premium" policies (Wall Street Journal, 1/29). In addition, WellPoint said more than 80% of enrollees submitted applications through the state and federal exchange websites (Hancock, "Capsules," Kaiser Health News, 1/29).
According to Modern Healthcare, WellPoint's enrollment figures include those who have signed up as of last week. The figure also contains some who have not paid their first month's premiums because the insurer has given customers until Jan. 31 to pay for coverage retroactive to Jan. 1 (Modern Healthcare, 1/29).
During an investor call outlining the numbers, WellPoint CEO Joseph Swedish told analysts that early data, including the age, sex and type of prescriptions filled by its exchange enrollees, suggest that individuals are older than its previous individual consumers. However, he added that they are in line with the company's projections and pricing for the new policies. WellPoint projected that it would earn a margin of 3% to 5% on its exchange plans (Wall Street Journal, 1/29). WellPoint expects to add more than one million new customers in 2014 (Easley, "Healthwatch," The Hill, 1/29).
WellPoint's Fourth-Quarter Earnings
Meanwhile, WellPoint reported that fourth-quarter profits declined from $2.7 billion in 2012 to $2.5 billion in 2013, Modern Healthcare reports.
The company attributed the decline in part to an uptick in consumer medical services after some people learned their old policies would be canceled. Swedish said, "We believe this uptick, year over year in the individual market, was prompted by some members seeking service prior to the potential changes in coverage in 2014" (Modern Healthcare, 1/29).
WellPoint also attributed the decline in profit to a charge related to the recent sale of its 1-800 Contacts subsidiary and a tax settlement from a year prior (Wall Street Journal, 1/29).
WellPoint Chief Financial Officer Wayne DeVeydt said the company expects that there will be a $100 million negative effect in 2014 as a result of changes to the ACA, in which the Obama administration allowed older individual plans to be renewed and expanded eligibility for catastrophic coverage plans (Humer, Reuters, 1/29).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.