In case you missed the breaking news yesterday afternoon, the nation’s largest health insurance carrier will no longer be offering health plans on North Carolina’s federal exchange in 2017.
That leaves North Carolina with just two companies offering plans to people who do not get health insurance through their employer.
UnitedHealth’s decision also means that one quarter of the state’s exchange enrollees (155,000 policyholders) will be left with just one insurance carrier to purchase health insurance from starting next year. But that insurer, Blue Cross and Blue Shield (BCBS), may be also be considering its exit next year as well. BCBS is the only company to sell plans in all 100 counties. Coventry, the other exchange participant, operates in just 39 counties.
United and other established carriers have reported losses amounting to hundreds of millions of dollars on Obamacare plans. Claims costs are outpacing premium revenue because these companies must accept people with expensive, pre-existing health conditions. Other policyholders are signing up, accessing costly treatments, and then dropping their plans.
When Obamacare’s exchanges opened for business in 2014, insurance companies knew they were in for an initial financial hit. To mitigate resistance from participating in the exchanges, the federal health law offered temporary funding streams to help balance initial destabilization.
But even with these funds, the losses are still pretty significant. Experts are now saying that insurers won’t be enjoying balanced risk pools – where enough young and healthy enrollees will offset the costs of expensive enrollees – until 2018.
You can read the Charlotte Observer’s full article on United’s announcement here. You can also read their editorial board’s article on how Obamacare is – ahem, working.
