UnitedHealth plans to exit Obamacare exchanges
NEW YORK – US health insurer UnitedHealth Group Inc said it would largely exit the Obamacare individual insurance market in 2017, citing expectations for mounting losses from the program.
UnitedHealth is the largest US health insurer and one of the biggest sellers of plans on the exchanges, which were created as part of President Barack Obama’s national healthcare law. UnitedHealth sells these plans in 34 states this year, up from 25 states last year.
“Next year, we will remain in only a handful of states,” UnitedHealth CEO Stephen Hemsley said in prepared remarks as part of the company’s first-quarter earnings report.
The company warned investors late last year that it was losing money on the new plans and might exit the market. On Tuesday, the company raised its 2016 expectation for losses on the exchanges by $125 million to $650 million.
UnitedHealth’s Hemsley said that the shorter term, higher risk profile of the new members, as well as the smaller than expected enrollment, suggested UnitedHealth could not offer plans on a sustained basis.