UnitedHealth Group Bails on Exchange, Premiums Jump

Leaving the Exchange

Not only is a major health care plan bailing on Covered California, California’s health care exchange, but premiums are estimated to jump 13.2 percent on average next year, according to two recent articles from Kaiser Health News (KHN) and California Healthline.

UnitedHealth Group is set to leave the exchange at the end of the year. According to the KHN article, UnitedHealth only joined the exchanged this year.

UnitedHealth’s Chief Executive Stephen Hensley had stated in April as saying that the health insurer wouldn’t continue on a health exchange path if it led to more money loss, according to KHN.

According to the article, the exchange’s executive director, Peter Lee, said that UnitedHealth is blaming the Affordable Care Act (Obamacare) instead of taking responsibility for its own business mistakes.

While UnitedHealth is leaving the exchange, New York-based Oscar Insurance Corp. is expanding to more counties in California next year, including San Francisco, San Mateo and Santa Clara, according to a San Francisco Chronicle article.

The Hike

The California Healthline article reports that despite being able to maintain 4 percent rate increases in its first two years, Covered California would be unable to do that in 2017 due to increasing medical costs as well as two federal programs that helped insurers keep costs down are expiring this year.

These rate hikes only apply to individuals purchasing from the exchange not the majority who get their health insurance through Medi-Cal or Medicaid.

Of the 19 regions under Covered California, Monterey, Santa Cruz, and San Benito will have the largest average increase in premiums at 28.6 percent, according to the article. Despite the premium increases, Covered California points out that the three-year average increase of 7 percent is lower than pre-Affordable Care Act trends. Additionally, a vast majority of the affected public will see premium decreases or small rate hikes if they shop plans.

“Almost 80 percent of our consumers will either be able to pay less than they are paying now, or see their rates go up by no more than 5 percent, if they shop and buy the lowest-cost plan at their same benefit level,” said Lee.

To read the full articles and press releases referenced in this story, click on the following links:

UnitedHealth To Exit California’s Obamacare Market

Covered California Health Plan Rates To Jump 13.2 Percent In 2017

Covered California Announces Rates and Plan Expansions for 2017