(Bloomberg) — UnitedHealth Group Inc. (NYSE:UNH) plans to exit a third state public health insurance exchange as the insurer works to stem losses from its struggling exchange business.
The insurer won’t sell policies through Michigan’s Patient Protection and Affordable Care Act (PPACA) exchange or the state’s off-exchange individual market for next year, according to Andrea Miller, a spokeswoman for the state’s Department of Insurance and Financial Services. Georgia and Arkansas said last week that UnitedHealth will quit their exchanges for 2017.
UnitedHealth, the largest U.S. health insurer, began warning in November that it was losing money on its PPACA policies and might exit some markets. PPACA, which is also known as Obamacare, relies on private health-insurance companies to offer policies that individuals can buy in government-run markets. Though it was selling plans in many states, UnitedHealth is a smaller player in the PPACA exchange market than rivals like Aetna Inc. (NYSE:AET) and Anthem Inc. (NYSE:ANTM).
UnitedHealth’s decision to stop offering PPACA exchange plans next year means that people who are currently enrolled with the insurer in those states will have to choose a new health insurance provider next year. It doesn’t affect current coverage.
A UnitedHealth spokesman confirmed the company’s move. UnitedHealth is scheduled to report first-quarter financial results April 19.
About 12.7 million people picked individual PPACA exchange plans for this year, including about 346,000 in Michigan, according to the Centers for Medicare & Medicaid Services (CMS). Fifteen insurers sold policies in the state for this year, U.S. data show.
“As with any new market, we expect changes and adjustments in the early years with issuers both entering and exiting states,” Benjamin Wakana, a spokesman for the Department of Health and Human Services (HHS), said in an e-mail. “We have full confidence, based on data, that the marketplaces will continue to thrive for years ahead.”
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