- California officials said UnitedHealth Group will abandon the state's ACA insurance exchange market at the end of this year, California Healthline reported.
- The exit follows the carrier’s April announcement that it would leave most of the 34 ACA markets it operates in, although California was not mentioned at the time
- The action will bring the number of state ACA markets the insurer plans to exit in 2017 to at least 27. The insurer confirmed late last month it's plan to exit the Iowa and Kentucky ACA markets.
UnitedHealth will also stop selling individual policies outside the Covered California exchange.
Stephen Hemsley, CEO of UnitedHealth, has warned that the payer won’t stand for continued losses in its exchange business. In an April conference call, he told investors that “the smaller overall market size and shorter term, higher-risk profile within this market segment continue to suggest we cannot broadly serve it on an effective and sustained basis.”
This is UnitedHealth’s first year on the California exchange and it only has about 1,200 members. They will be able to weigh their options for coverage next year when 2017 rates and plans are released in July, a Covered California spokeswoman said.
Obamacare critics have pointed to UnitedHealth’s multistate exit as proof that the insurance exchanges are financially challenged. But the White House maintains that the number of insurers offering plans there has increased since the health insurance program launched in 2014.
Peter Lee, executive director of Covered California, has accused UnitedHealth of blaming the Affordable Care Act for its losses, rather than owning up to its own business shortcomings.