Experts weigh in on future of ACA in New Jersey

The departure of Health Republic Insurance of New Jersey from the insurance marketplace last week - on the heels of exits by both Oscar and UnitedHealthcare and a decision by Aetna to not enter the market at all - had many wondering if the Affordable Care Act exchanges were collapsing in New Jersey.

But even though the departures leave the state with only two ACA exchange options for next year, AmeriHealth and Horizon Blue Cross Blue Shield of New Jersey, industry analysts still say they are confident about the future.

The reason: A proposed rule from the Centers for Medicare and Medicaid Sendees that would help improve risk estimates. The rule would go into effect in 2018.

"In particular, we propose updates to better estimate the risk associated with enrollees who are not enrolled for a full 12 months, to use prescription drug data to update the predictive ability of our risk adjustment models and to establish transfers that will better account for the risk of highcost enrollees," according to CMS.

"We propose a number of policies relating to the use of external data gathering environment (EDGE) server data for recalibration of our risk adjustment models, and the use of more recent data for future calibrations."

Will it be enough? Here what some experts say about the marketplace:

Linda Schwimmer, New' Jersey Health Care Quality Institute: "UnitedHealthcare and Aetna ... are both still in our individual marketplace and small group in New' Jersey. It's a lot easier for them to pivot back. They are already in the marketplace and already selling products that have to comply with the ACA. So, when they do decide to come back to New Jersey ... it will be a lot easier (for major insurance carriers)."

Ray Castro, New Jersey Policy Perspective: "We need reform at the federal and state levels to have a stable market, for both consumers and insurers. We need to get our act together in New' Jersey to make it more competitive and eliminate surprise billing."

Ward Sanders, New Jersey Association of Health Plans: "It means the risk adjustment mechanism many had pointed to is a challenge for new' and startup carriers. It does go to show the challenge of hating a vibrant market, especially in a state like New Jersey."

Ryan Petrizzi, AmeriHealth: "From the start, we knew títere would be a decent amount of trial and error that came with implementing the ACA. The law has provided access to care, but it hasn't adequately addressed the pressing issue every single stakeholder in our industry grapples with, which is the cost of care.

"As an industry, we continue to make strides to address costs, but challenges still remain. The ending of risk corridors is only one contributing factor. This year, market trends across the nation have contributed to higher rate increases than consumers have seen in the past, including the rising cost of care, increased utilization and rising drug costs. In addition, individuals who enrolled during a Special Enrollment Period had higher medical expenses."

Mark Manigan, Brach Eichler: "The financial experience of insurers in the exchange market has been awful. Irrespective of where one falls on the political spectrum, it is hard to characterize insurers dropping out and the potential collapse of the exchange markets as anything but bad news, not only for individuals who have found refuge in these markets, but also for health care providers who have benefited from exposure to a more well-insured patient population."

Aetna (in a statement from August): "Providing affordable, high-quality health care options to consumers is not possible without a balanced risk pool. Fifty-five percent of our individual on-exchange membership is new in 2016, and in the second quarter we saw individuals in need of highcost care represent an even larger share of our on-exchange population. This population dynamic, coupled with the current inadequate risk adjustment mechanism, results in substantial upward pressure on premiums and creates significant sustainability concerns.

Horizon Blue Cross Blue Shield of New Jersey declined to comment. UnitedHealthcare could not be reached for comment.