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Anthem's '18 exchange participation hinges on changes to healthcare law

Anthem Inc. Chairman, President and CEO Joseph Swedish said the insurer is lobbying the new administration and Congress to push for several changes to health insurance regulation, which he said are needed for the sustainability of health insurance exchanges.

The insurer wants, among other things, a repeal of the Affordable Care Act's health insurance tax, a reduction in the number of exemptions for special enrollments and measures to prevent third parties from steering individuals into ACA plans when they are eligible for Medicare or Medicaid, Swedish said during a conference call to discuss fourth-quarter 2016 earnings.

The executive said evaluating Anthem's own participation in health insurance exchanges is difficult at this point since there is no clarity on what the new administration's healthcare regulation will look like, once it dismantles the current healthcare law. But he warned that Anthem may consider pulling out of insurance exchanges if the measures it has suggested are not implemented.

"We will be monitoring very carefully to see if they are implemented," the CEO said. "As we approach the end of the first half of this year, we will have to make decisions ... whether or not we surgically extract ourselves from certain regions, or quite frankly, even on a larger scale, dependent on the stability of the marketplace."

Anthem attracted larger-than-expected applicants during the recently concluded enrollment period for individuals to sign up for health insurance, according to CFO John Gallina. While the insurer is "comfortable" with the demographic mix of the applicants, it is still premature to evaluate what the renewal membership will look like, he added.

The company ended 2016 with more than 1.3 million individual ACA-compliant lives, 839,000 of which came from the individual exchanges. The insurer projects some membership declines in 2017 and continues to expect the individual business to either break even or make small profits.