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J. Mario Molina

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How Molina lives with lower rates


While the Affordable Care Act has helped decrease the  national uninsured rate, it hasn’t  really addressed  healthcare costs, J. Mario Molina, chief executive of Molina Healthcare, one of the nation’s largest managed-care companies, told  Albuquerque Business First.

“I think the next evolution of healthcare reform is figuring out how we do a better job of controlling costs,” he said.

However, Mr. Molina has reasons to be happy about the ACA — it has helped  his company expand, in large part because Medicaid is one of Molina’s primary businesses. So it got many more patients as many states enrolled many more individuals as many states chose to expand their Medicaid programs under the ACA.

Mr. Molina said that his company’s premium-pricing strategy helped let it live with lower rates than other insurers, which have reached very high levels.

He cited the fact that  the insurer didn’t expect to receive any federal funds under the ACA’s risk programs.  That meant Molina could go in conservative because it didn’t have any prior experience, so the company either lowered rates or kept them relatively flat.

He also spoke about about the reinsurance, risk-adjustment and risk corridors: “a lot of companies are looking at the three Rs to help them and we weren’t looking at that at all. We assumed that this was going to be a product that would stand on its own and that’s how we priced it. It’s really worked out for us.”



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