What will be the impact of UnitedHealthCare's exit from most state Obamacare markets?
Although the mega insurer only accounts for a fraction of the health plans offered through the federal and state marketplaces set up by the Patient Protection and Affordable Care Act (PPACA), consumer advocates worry that its departure will lead to price hikes.
As Kaiser Health News notes, certain regions of the country will be more severely impacted than others. It highlights Lee and Collier counties in southwest Florida that will be left with only one PPACA health plan because of United's exit. The same is true of two counties in Oklahoma.
Recommended For You
In both cases, the state Blue Cross Blue Shield network will be left with a monopoly in the area.
The good news, apparently, is that UnitedHealth's plans generally were not the lowest cost ones offered in the marketplace. That suggests that the insurer's absence will not lead to major price increases.
"United is not a low-premium issuer," Jodi Ray, director of Florida Covering Kids & Families, a group that helps sign people up for PPACA plans, told Kaiser. "Consumers will adjust accordingly no matter who the issuer is."
It's not a total loss everywhere. In Iowa, for instance, another insurer, Wellmark Blue Cross Blue Shield, is entering the PPACA marketplace in the wake of UnitedHealth's departure.
The decision from UnitedHealth to leave all but a few state marketplaces won't go into effect until January. The company might announce withdrawal from other marketplaces in the coming months, as it has threatened to do since the beginning of the year. Its justification for leaving is quite simple: It's not turning a profit on its Obamacare business because claims are exceeding premiums.
A number of major insurers have suggested they will not be able to continue participating in the PPACA marketplace, United is so far the only company to make good on its threat. On Tuesday, Kentucky became the 26th state in which UnitedHealth will no longer offer PPACA plans.
"UnitedHealthcare's intent to withdraw from the market was not unexpected," Doug Hogan, a spokesman for the Kentucky Public Protection Cabinet, which oversees the state's insurance regulator, told Bloomberg. "Insurers across the country have been losing hundreds of millions of dollars in the Obamacare exchanges and can no longer sustain such heavy financial losses."
The small silver lining in the recent news is that, contrary to its prior suggestions, UnitedHealth appears committed to staying in at least several states, including New York, Nevada, and Virginia.
The Obama administration, faced with the prospect of losing insurers to poor profits and consumers to high prices, has stepped up efforts to increase enrollment. It has upped penalties for those who go without insurance, has announced it will be stricter in enforcing enrollment deadlines and is promoting enrollment through a variety of public relations campaigns.
Lynne Thorp, regional director of the Health Planning Council of Southwest Florida, told Kaiser that a major obstacle to enrollment remains the lack of awareness among consumers about the subsidies they can receive to pay for insurance.
"It's still surprising how many people we find who don't know that," she said.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
