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2017 May Offer Fewer Choices for Affordable Care Act Enrollees

UnitedHealth’s exit from most marketplaces highlights health exchanges’ growing pains

MONDAY, May 2, 2016 (HealthDay News) — With the nation’s largest health insurer exiting all but a few Affordable Care Act exchanges next year, some Americans may be left with fewer choices and some might see higher monthly premiums.

Experts say that will be the upshot of UnitedHealth Group Inc.’s recent announcement that it will pull out of most of the 34 states where it offers health plans on the public health insurance exchanges. Meanwhile, health insurers stung by the high cost of covering public health exchange enrollees are expected to request sharply higher rates for 2017. In Virginia alone, nine insurers have proposed average rate hikes ranging from more than 9 percent to 37 percent, the Associated Press reported.

While most consumers can choose from three or more insurers, UnitedHealth’s departure could curtail choices to one or two in a handful of southern and midwestern states, a recent Kaiser Family Foundation analysis suggests. But UnitedHealth’s withdrawal is expected to have a minimal effect on the average “benchmark” premium nationwide, the foundation said. It would likely have the largest effect in Alabama, Arizona, Iowa, Nebraska, and North Carolina. UnitedHealth, which covers 795,000 exchange customers, has said it expects to lose $650 million on its exchange business in 2016.

In a February call with investors, Aetna Inc. said their company’s public exchange business remains unprofitable. And some Blue Cross Blue Shield insurance plans, including those in Alabama and North Carolina, also have reported red ink on plans sold on the Affordable Care Act exchanges, according to news reports. One notable exception is Anthem Inc., the nation’s largest for-profit Blues plan. Anthem officials said last week that the company remains on target to post a slim profit this year on its public exchange business.

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