Humana will determine the magnitude of its loss after it evaluates the mix of members enrolled in its ACA-compliant plans, including membership changes that occurred because of product discontinuation, demographic changes and whether the new members who enrolled were previously insured, according to the report. The company noted that it has set aside a premium deficiency reserve to make up the difference.
This marks the second investor-owned insurer to report it is having issues with the federal health-reform law. UnitedHealth Group, the nation’s largest insurer, announced in November that it had lost $425 million on health plans sold on ACA marketplaces and suggested it may leave the exchanges by 2017, Bob Herman reported for Modern Healthcare.
Humana also told the SEC that it expects up to 300,000 of its individual commercial members, which include those it gained through the reform law, to drop their coverage by the end of the year. It didn’t offer any reasons in the report. The company’s fourth quarter 2015 earnings and guidance for 2016 are set to be released Feb. 10.
Plans for Aetna Inc. to buy Humana for $37 billion have been approved by their respective boards of directors and stockholders, but the deal awaits approval of federal regulators, and several states are having their say, Grace Schneider reports for The Courier-Journal.