Cuomo Takes Steps to Keep New York Insurers in Obamacare

(Bloomberg) -- New York Governor Andrew Cuomo announced steps on Monday to encourage insurers to keep selling health plans in the state's Obamacare exchange, as the companies withdraw from other markets amid uncertainty surrounding the health law.

The state is tying participation in the Affordable Care Act's marketplaces to other government contracts. Insurers that exit Obamacare's individual market would be cut off from government business including Medicaid, the children's health insurance program and the Essential Plan, which offers cheap coverage to some low-income people who don't qualify for other programs, according to a statement from the governor's office.

With Congressional Republicans working to repeal and replace Obamacare, and the Trump administration fomenting uncertainty about some funding for insurers, major national carriers like Aetna Inc. and Humana Inc., as well as smaller regional plans, have quit some states. Those departures have threatened to leave some consumers without any insurance options for 2018, and Republicans have pointed to them as a sign the health law is failing.

While choices vary by county, New York has more individual-insurance options than some other states, with 14 companies offering health plans for 2017. Publicly traded carriers that sell in the state's exchange include Anthem Inc. and UnitedHealth Group Inc. UnitedHealth has largely exited Obamacare in other states, while Anthem has indicated it's weighing whether to leave some regions.

Graphic: Obamacare Customers Left Without Options as Insurers Bolt

The new measure may push insurers to stay in the state's Obamacare exchange, because the other government businesses are far larger. About 242,000 people enrolled in individual health plans through the state's exchange, while 665,000 picked Essential Plans. More than 6 million people are enrolled in Medicaid, the program for the poor, and a related children's health insurance program in New York, according to federal data.

New York insurers have concerns about the plan, especially since the regulations to put it in place aren't yet available, said Leslie Moran, senior vice president at the New York Health Plan Association.

“We're not sure that they can legally just say we won't contract, because there are already contracts in place,” she said. “We just have some questions and concerns about where they're trying to go with that.”

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net.

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Timothy Annett