At its core, the Affordable Care Act, or ACA, was set up to establish a better financial relationship between Americans and the health care system. One of the direct consequences of that is the improvement of the individual health care insurance market.
The law literally provides a marketplace where individuals can compare private insurance plans. A plus for citizens, this will likely enhance competition in the individual insurance market.
To stay competitive in the post-ACA era, a handful of companies are expanding their individual health care policy options.
State Farm And Blue Cross Blue Shield
On September 23, State Farm announced that it would partner with Blue Cross Blue Shield health plans to broaden consumer access to individual health policies when signup begins in November for private coverage under the ACA.
State Farm said that its agent offices in Illinois, Montana, New Mexico, Oklahoma and Texas would now offer individual health insurance policies. The 3,300 extra agents from State Farm will only help the two insurers take charge of the states they operate in.
State Farm said it would market the private health plans on and off government exchanges. More interestingly, it also said the plans that are chosen would be available in every zip code –- a step toward comprehensive health care coverage in the U.S.
This move further cements UnitedHealth’s status as the largest healthcare insurer in the U.S. UnitedHealth has been successful with its government business line, having grown its Medicaid enrollment for the poor by 19 percent in the past year.
With that level of success, there's a chance UnitedHealth will be a winner –- and help Americans as well -– under the ACA.
In its second quarter report, Humana Inc (NYSE: HUM) noted that its individual commercial membership had increased 122 percent since the beginning of the year, thanks to the new health law. Humana is one of the first companies to enter the ACA marketplace. The company now has about 700,000 members enrolled in ACA plans.
While the company is not necessarily working on expanding into other states at the moment, it is doing well to make its ACA program a success. The company recently partnered with CVS Health Corp (NYSE: CVS) to educate individuals and their families about their health care coverage options under the ACA.
With Humana already offering individual health insurance under the ACA in 14 states, this move should help widen the company’s reach. Humana will have representatives at CVS’s Project Health events, which started in October.
Humana will also hold in-store events at CVS pharmacy locations to educate individuals on their health coverage options under the ACA.
CIGNA Corporation (NYSE: CI) is already offering individual health care plans under the ACA in five states: Arizona, Florida, Colorado, Tennessee and Texas.
Cigna announced during its second quarter call that it plans to expand into Maryland, Missouri and Georgia next year. The company anticipates a margin of 3 to 5 percent from exchanges, which should be sufficient for the program to be sustainable.
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