SAN FRANCISCO — Molina Healthcare is transferring a quarter of its insurance premiums to other insurers under Obamacare rules, the company’s CEO said Monday morning.
“Right now we are transferring about 25 percent of our premiums to our competitors,” Joseph Molina said in a presentation at the JPMorgan Healthcare Investor Conference. “You’re welcome.”
Molina, a small health insurer that has been one of the most successful participants in the new marketplaces, is required by the Affordable Care Act to help pay for other companies’ losses through a risk adjustment program. The program is intended to prevent insurers from cherry-picking only the healthiest enrollees by spreading the risk.
Several smaller carriers, including Molina, have had to pay into the program while larger insurers including Anthem, Aetna and Cigna have collected payouts.
Molina said he’s looking forward to 2018, when there will be some changes to how risk adjustment payments are calculated. He said those changes will lead to a 14 percent reduction in his company’s payments.
“That will be very beneficial to us — provided the marketplace is around in 2018,” Molina told attendees.
Molina said his company has dramatically expanded its participation in the marketplaces, now covering 700,000 enrollees as of Jan. 1. But he noted there’s “considerable uncertainty” around the exchanges as Republicans in Congress discuss repealing and replacing the healthcare law.
“As you know, this comes with considerable uncertainty,” Molina said. “Republicans have talked a lot about repealing and replacing the ACA and removing the subsidies, which are integral.”
