OLDWICK, N.J.--(BUSINESS WIRE)--
The U.S. Supreme Court’s ruling to uphold the Patient Protection and
Affordable Care Act (PPACA) has not caught health insurers off guard.
Since PPACA legislation was enacted in 2010, health insurers have been
preparing to operate in a new health insurance environment for 2014—one
that includes the individual mandate, guaranteed issue for coverage and
health insurance exchanges, among other provisions.
A.M. Best Co.has maintained a stable outlook on the majority of
health insurers as their earnings have strengthened over the past few
years, largely due to improved, lower utilization and more diversified
sources of income and revenue. While margins are expected to narrow as
utilization returns to more normal levels and the impact of PPACA begins
to be felt, A.M. Best expects the majority of health insurers to remain
Furthermore, health insurers have been in discussions with governors,
state legislatures, insurance commissioners/departments and other
parties on the importance of establishing a framework for state-based
health insurance exchanges. If a state does not have a state-based
exchange established in time for a Jan. 1, 2014 effective date, the
state would utilize the federal health insurance exchange until a state
exchange can be established. However, to date, less than one-third of
the states have passed exchange legislation, and numerous states have
taken no significant steps toward developing exchanges or passing
exchange legislation. Additionally, while some states were waiting for
the Supreme Court’s decision, others are waiting for the outcome of the
November 2012 elections. If the Republicans gain control in these
elections, including the presidency, the law may face challenges in
Much work needs to be done to make exchanges operational, and rules have
yet to be defined, such as essential benefits and subsidy levels. As
such, there could be delays in implementing exchanges as there may not
be enough lead time to get state-based exchanges fully operational for
open enrollment for a Jan. 1, 2014 effective date.
To access a copy of this special report, please visit http://www.ambest.com/press/072001healthcarereformbriefing.pdf.
To watch a video of Sally Rosen discussing the briefing, please visit http://www.ambest.com/v.asp?v=rosen712.
Founded in 1899, A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2012 by A.M. Best Company, Inc.ALL RIGHTS
A.M. Best Co.Sally Rosen, 908-439-2200 ext. 5280Managing
Senior Financial Analystsally.firstname.lastname@example.orgRachelle
Morrow, 908-439-2200, ext. 5378Senior Manager, Public
Peavy, 908-439-2200, ext. 5644Assistant Vice President,
Source: A.M. Best Co.