Aetna this year exited 11 out of the 15 states where the company had sold individual insurance plans on ACA exchanges. Aetna cited losses from that business since exchange-sold plans began coverage in 2014, and fears that the pool of customers would continue to contain too many sick people and too few healthy ones.
Bertolini said that risk remains for Aetna in the four states where it continues to sell ACA plans, and in the states where it left.
"The biggest risk for us is that in the ACA we lost $450 million last year, $100 million more than we expected," Bertolini said when asked about earnings in 2017. "The risk pools continue to deteriorate and we are still in a number of exchanges, with 240,000 members, of which half are still new."
"So the risk associated with that population, as the risk pools changes," and the elimination of Obamacare programs designed to mitigate insurers' financial downside, "create some headwinds for us in '17," Bertolini said.
Bertolini mentioned that deterioration of the risk pools in Aetna's remaining ACA markets again when he was asked about criticism by U.S. District Judge John Bates.
In his decision last week blocking the merger with Humana, Bates said Aetna had threatened to leave a number of states as it "tried to leverage its participation in the exchange for favorable treatment from [regulators] regarding the proposed merger."
Bates also said that Aetna had left 17 counties where it was competing with Humana "at least in part for the purpose of improving its litigation position" against the Justice Department, which sued to block the merger.
Bertolini on Tuesday said, "The Department of Justice and the courts look at things by county. As a business, we operate by state, we can't have an office in every county."
"So the analysis of 17 counties that were part of the complaint is really an interesting analysis ... in the halls of justice," Bertolini said. "But in our business, we have to operate by state, and we made our decisions by state. We made our decisions based on forward-looking earnings for 2017, because we had to file our rates for '17 in April of 2016, and we are seeing a deterioration of those markets, as we expected, which would have created greater risk for us in 2017."
Bertolini was asked about Trump's meeting earlier Tuesday with the CEOs of a number of leading pharmaceutical companies. At that meeting, Trump repeatedly stressed the need to lower drug prices — a message that will resonate with insurers, who for years have complained about the costs of prescription medications.
"Costs in drugs are the fastest rising cost that we see across the spectrum," Bertolini said. "In drugs, we are seeing double-digit increases year over year, largely driven by specialty drugs. We have to find a solution to make these programs more affordable."
"If in fact we're looking for a way to make [insurance plan] premiums more affordable, we have to address drug costs sooner rather than later," Bertolini said.