Moody\u2019s announced Thursday it was downgrading its outlook for health insurers from stable to negative based on uncertainty related to ObamaCare.<\/p>\n
The credit rating agency cited an unstable environment because of the healthcare law\u2019s difficult rollout, and projected that insurers would earn 2 percent less than forecast in 2014.<\/p>\n
\u201cWhile we\u2019ve had industry risks from regulatory changes on our radar for a while, the ongoing unstable and evolving environment is a key factor for our outlook change,\u201d Moody\u2019s Senior Vice President Stephen Zaharuk said in a statement. \u201cThe past few months have seen new regulations and announcements that impose operational changes well after product and pricing decisions were finalized.\u201d<\/p>\n
The Moody\u2019s report also cites the slow enrollment of young people into ObamaCare as a reason for the downgrade.<\/p>\n
\u201cUncertainty over the demographics of those enrolling in individual products through the exchanges is a key factor in Moody\u2019s outlook change,\u201d the ratings agency said.<\/p>\n
Citing statistics released by the administration, it noted that so far about 24 percent of enrollees are between the ages of 18 and 34, while a target of 40 percent may be necessary to keep premiums from rising in the future.<\/p>\n
It said the 24 percent of young people enrolled so far is \u201cwell short\u201d of the 40 percent target.<\/p>\n
Moody\u2019s also said it was worried that insurers\u2019 premium calculations might not be enough to cover the industry assessment tax that begins in 2014.<\/p>\n