The last of the major American health insurers to have a big presence in the Obamacare marketplaces for 2017 warned Wednesday that it may not remain there for long if business doesn't improve.
Anthem CEO Joseph Swedish, calling sales of Obamacare plans "disappointing" since 2013, said "Clearly, 2017 is a critical year as we continue to assess the long-term viability" of the insurer's presence on Affordable Care Act marketplaces.
"We will continue to closely monitor this business," Swedish said during Anthem's third-quarter earnings call after the company announced profit of $2.45 per share after excluding some items.
"And if we do not see clear evidence of an improving environment and a path towards sustainability in the marketplace, we will likely modify our strategy in 2018," he said.
Swedish's sobering comments came a day after open enrollment began in individual health insurance plans that comply with ACA standards, and which go into effect in 2017.
He said Wednesday that the company's pricing of Obamacare plans leaves Anthem expecting "to return to slight profitability" on those plans in 2017.
If it does scale back its Obamacare business, Anthem, which sells plans on ACA exchanges in 14 states, would join other big U.S. insurers — UnitedHealthGroup, Aetna and Humana — that are largely exiting those marketplaces. Those other companies have booked big losses on their Obamacare plans.
Swedish said Anthem believes "both the pricing and regulatory environment needs to be improved to drive towards a sustainable and affordable marketplace over the long term."
Like the other insurers who have pulled back, Swedish said, "We continue to experience higher than initially expected costs from members with chronic conditions."
"Overall, the financial performance in [Obamacare] plans has been disappointing, as membership has been short of our original expectations since its inception and operating margins have been lower than expected beginning in 2015," Swedish said.