Law360 Looks to Joel Ario on Insurers’ Health Reform Plans

Law360 Looks to Joel Ario on Insurers’ Health Reform Plans

“Health Care Ruling is Mixed Blessing for Insurers”

June 28, 2012 – Law360 turned to Manatt’s Joel Ario, a managing director with Manatt Health Solutions, for insight into how the Supreme Court’s decision to uphold health reform affects health insurance providers.

As reported by Law360, the Patient Protection and Affordable Care Act (ACA) promises to greatly increase the number of individuals buying insurance, thus presenting the health insurance industry with a significant opportunity to boost its customer base. However, there will be a number of regulatory and administrative hurdles that the industry will face.

Industry insiders said that insurers will be focusing on how health reform is implemented at the state and federal levels. Insurance companies must prepare to comply with the ACA as the rules are being written. They will also take an active role in the process, weighing in as rules are proposed and working closely with states to set up exchanges that allow consumers to easily purchase plans.

Ario, who is the former director of the Office of Health Insurance Exchanges at the U.S. Department of Health and Human Services, told Law360 that health insurers would likely prod states to develop their own exchanges rather than let the federal government take over.

Insurers will be on the alert as states use new powers afforded by the law. Since the ACA ratchets up regulatory scrutiny over rate hikes of more than 10 percent, they will want to make sure they are treated fairly and that politics don’t come into play while their justifications for rate hikes are put under the microscope, said Ario.

“There is more of a spotlight on those rate increases,” Ario said. “Insurers are going to be very concerned that they get a fair shake on their pricing.”

The ACA’s goal to make the health insurance marketplace more consumer-friendly will also influence insurers’ marketing strategies, Ario added.

“It does force insurers to compete for the business of consumers more directly than in the past,” he said. “You’re starting to see the big insurers pay more attention to their brand.”

But no matter the challenges ahead, the Supreme Court’s ruling is ultimately a victory for the health insurance industry, Ario said.

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