Newspaper article THE JOURNAL RECORD

Oklahoma Insurance Exec: Exhanges Will Be Transformative for Health Insurance Industry

Newspaper article THE JOURNAL RECORD

Oklahoma Insurance Exec: Exhanges Will Be Transformative for Health Insurance Industry

Article excerpt

The future of the Affordable Care Act still comes with unknowns, and Bert Marshall is thinking about all of them.

Marshall, president of Blue Cross and Blue Shield of Oklahoma, spoke Thursday during the University of Oklahoma Public Health Grand Rounds, beginning his remarks by saying that the insurance industry does more good than the political debate around the ACA suggested.

Blue Cross and Blue Shield of Oklahoma insures 800,000 people in the state, Marshall said. Much of his industry's future hinges on what happens when Medicaid expands to take on more people (some 250,000 in Oklahoma); exchanges are formed for people who are 133 to 400 percent of the federal poverty level, and they receive subsidies to buy insurance through that exchange; and health insurance reform, fines on companies that don't offer coverage, and waiver of pre- existing conditions come into play.

"When you look at the estimates on how much the Medicaid expansion and the new subsidies are going to cost, you have to make assumptions about how many people will in fact take advantage of the subsidies, or to put it a different way, how many large employers will retain group coverage and not dump into the exchange? It becomes a math issue," Marshall said. "If the penalty for an employer is X, and the cost of keeping group coverage may be a multiple of X, is the employer financially better off maintaining group insurance coverage or paying the penalty and allowing the employees to go into the exchange? Depending on how this really works out around those corporate board rooms is going to define how expensive the Affordable Care Act is in the final case."

Marshall cited the McKinsey Report, which predicted a major "dumping" into the exchange, and the Rand Analysis, which said that's not going to happen.

"I would just submit to you that something is going to happen and we don't know exactly what it is," he said. "But the fact that there is going to be an exchange is going to be transformative for my business because most of the business that companies like Blue Cross sell across this country is group-based. One of our most prestigious accounts is the University of Oklahoma, but we don't deal with every faculty member or every individual who works here. We go to the HR or purchasing staff, and that's who makes the decision on behalf of everyone. …

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