The big U.S. health insurers that Standard & Poor's Global Ratings rates continue to look fine, in spite of all the commotion in Washington surrounding efforts to change the Affordable Care Act.
Rating analysts at S&P gave that assessment today in New York, at a health care sector conference aimed at attendees from the kinds of companies that might lend money to health care companies, buy their stock, or offer reinsurance. S&P's views on an industry sector or company can affect how much a company pays for finance, and whether the company can get financing.
"The ACA has been quite negative" for many insurers, according Joseph Marinucci, a senior director at S&P. But "balance sheet strength managed to endure."
High-deductible health plans now cover 40 million to 50 million people, and the high deductibles are encouraging the enrollees to help hold down the cost of care, Marinucci said during one panel discussion at the S&P conference.
Efforts to use narrow provider networks and other strategies may also help the insurers hold down costs, he said.
Many insurers began 2014, the year the ACA public exchange system and many ACA health insurance requirements came to life, with rates that were too low, but big increases in 2016 and 2017 may have now brought prices to about the right level, S&P analysts said.
Marinucci acknowledged that officials in Washington could cause problems in 2018, or even this year, by administering ACA programs, such as the cost-sharing reduction subsidy program, in a reluctant way.
But "there's awareness about that," and the insurers S&P rates have tried to price for that kind of uncertainty, Marinucci said.
Big health insurers also show a good understanding of the poor health of many of the people they now cover through individual and family major medical coverage, and they seem to be setting prices high enough to adjust for the individual and family coverage enrollees' morbidity levels, Marinucci said.
What the Insurers Think
