Senate GOP leaders have shelved their bill to dismantle and replace the Affordable Care Act, also known as “Obamacare.”
Mark Bertolini, the CEO of insurance giant Aetna (AET), argues that the ACA can’t be repealed. But he sees things that can be done to fix it.
“So here we have a bill that was passed in 2010, and hasn’t been touched for seven years because it’s been a political football,” Bertolini said in a wide-ranging interview with Yahoo Finance. “It was not bipartisan, and here we have it fraying at the edges because we haven’t made the changes necessary to keep it viable.”
“It can’t be repealed”
Bertolini noted that other major social programs such as Medicare, Medicaid, and Social Security have been bipartisan and they have been tweaked over the years.
“Any of those other programs wouldn’t work had we left them alone for seven years,” Bertolini said. “So this idea of it financially fraying at the edges… Its original rules and conditions aren’t what the world’s like today and those need to change.”
“Unfortunately, we have these politics of repeal that sits out there that really legitimately, in the Senate, can’t be done. It really can’t be repealed. It can be defunded, but it can’t be repealed.”
He is, however, hopeful a bipartisan fix can happen.
“I’m an eternal optimist, and I have great hope that a bipartisan solution will emerge,” he said. “I know there are people on both sides of the aisle and a lot of the leadership in both parties that want to get beyond this part of it and move into what could be a bipartisan solution and a fix that would be good for all Americans.”
We need to entice younger people to buy insurance
After rising losses, Aetna reduced its presence on the individual public exchanges established by the ACA. Aetna projected around $225 million in losses from its exchange plan businesses in 2017 on top of a loss of $700 million for 2014 through 2016. The insurer cited “marketplace structural issues, that have led to co-op failures and carrier exits, and subsequent risk pool deterioration.”
Bertolini told Yahoo Finance that there would need to be “a stable and predictable market” for Aetna to return to the public exchanges. One solution for fixing the ACA would be creating a balanced risk pool.
“I think the most important part is to create financial stability in the pool because we have sicker people and it’s always going to be a program that’s going to have sicker people because those are the people that are motivated to buy insurance, unfortunately, or fortunately,” Bertolini said. “We need to find ways to entice younger people to buy it if it’s not provided by their employer, and that needs to be a funding mechanism that is more cash based and savings based because young people don’t consider the risks of their future life as to be significant enough for them to worry about now.”
He continued: “And so if you do those two things in concert with continuing the Medicaid expansion, but expecting it to cost less if we have 70 million people in the program seven years from now and make sure that we show results in improving the quality of life and the quality of care and reducing costs going forward, all those things should work in making the future of this program work.”
Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.