UnitedHealth Group To Exit Most Health Plan Exchanges
Minnetonka-based UnitedHealth Group CEO Stephen Hemsley said Tuesday that the company plans to drop offering health plans through private exchanges in all but a few states for 2017. UnitedHealth Group, the nation’s largest insurer, currently offers plans through exchanges in 34 states.
“As you know, we have been evaluating public exchanges on a state-by-state basis,” Hemsley said on Tuesday morning during the company’s earnings conference call to discuss first quarter results. “Next year, we will remain in only a handful of states, and we will not carry financial exposure from exchanges into 2017.”
The company is not providing a list of states where they will continue to offer individual plans through exchange marketplaces in 2017. But so far the company has confirmed that it is exiting the exchange business in five states: Arkansas, Georgia, Michigan, Oklahoma and Louisiana.
While it is not yet clear how many states will constitute a “handful” next year, UnitedHealth has also confirmed that it will continue to offer health plans through exchanges in at least two states for 2017: Nevada and Virginia.
As TCB noted last week, reports first surfaced about 10 days ago that UnitedHealth Group planned to drop out of exchanges in two southern states.
The federal Affordable Care Act has created insurance exchanges where individuals can select health plans from competing insurers.
Previously, UnitedHealth was strongly expanding its presence in state exchanges. In 2014, the company offered plans in only four states, but increased that to 23 states in 2015. The company then boosted its exchange offerings to 34 states for 2016. But in November, the company signaled that it was reevaluating its insurance exchange business as losses mounted.
Aside from the exchanges, UnitedHealth’s business in booming. For the first quarter, UnitedHealth reported net income of $1.6 billion on revenue of $44.5 billion. The company’s revenue is up 25 percent compared to the first quarter of 2015.
The company also raised its financial outlook for 2016 and now projects approximately $182 billion in revenue this year.