Dive Brief:
- UnitedHealth's CEO stated this week the insurer should have stayed out of the ACA health exchanges longer than just the first year.
- The company announced Tuesday it was projecting its revenue for 2016 a bit lower than analysts had because of the steep losses it's experiencing from the exchange plans.
- UnitedHealth is predicting 2016 revenue of $180 to $181 billion, compared to analysts' average predictions of $182.36 billion. While the company's shares have been down 3.9% in the past three months, they are still up 11% overall this year, The Wall Street Journal reports.
Dive Insight:
UnitedHealth's guidance follows its recent public revelation it was suffering major losses on its ACA policies and might withdraw from the exchanges after 2016.
The company had mostly sat out from the system in 2014, and says it entered in 2015 and expanded its 2016 presence despite not yet having complete 2014 performance results on competitors.
“It was for us a bad decision,” UnitedHealth CEO Stephen Hemsley was quoted by LifeHealthPro. “I take accountability for sitting out the exchange market in year 1 so we could in theory observe, learn and see how the market experience would develop. This was a prudent going in position. In retrospect, we should have stayed out longer.”