ObamaCare has struck again, and the latest victim is American Enterprise Group – parent company of World Insurance Company and American Republic Insurance Company. American Enterprise announced that it’s closing its individual major medical insurance business, which provides health insurance in Texas and across the country to approximately 35,000 policyholders. The decision was based on the company’s inability to meet regulatory changes imposed by the Patient Protection and Affordable Care Act.
“It’s a fairly predictable consequence of the regulation,” said Michael Abbott, president and CEO of American Enterprise Group. “The regulatory environment’s getting really complicated.” One specific stressor is the legislation’s impact on medical loss ratios, which mandate that insurers must spend at least 80 percent of premiums on medical care. Given the intensive time and high cost of administering health plans, such mandates can kill company’s operating costs and profits, driving them out of business.
In an attempt to keep its customer base insured, American Enterprise has negotiated an arrangement with Celtic Insurance Company, who will offer guaranteed-issue policies to American Enterprise customers. This is one route for consumers to take, but it allows little choice and personalization of policies. It pushes people into a plan rather than allowing them to choose one that’s best for their specific health needs and budget.
Consumers affected by the closing of American Enterprise’s individual insurance business are encouraged to explore their options. Custom Health Plans offers a variety of individual health insurance plans and family health insurance plans that can be tailored to fit our clients’ needs. Losing your health insurance can be very stressful, but we can help consumers navigate through the confusion.
