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UnitedHealth warns it may exit Obamacare plans (health)

by AC @, Thursday, November 19, 2015, 20:33 @ AC

UnitedHealth warns it may exit Obamacare plans
Nathan Bomey and Jayne O'Donnell, USA TODAY 8:50 p.m. EST November 19, 2015

Insurance giant UnitedHealth Group dealt a blow to the Affordable Care Act on Thursday when it warned that it may stop offering insurance plans to individuals through the public exchanges established by the reform law. USA TODAY

The nation's largest health insurer warned Thursday that it may pull out of the Obamacare exchanges after 2016 – forcing more hundreds of millions of people to find other coverage – after low enrollment and high usage cost the company millions of dollars.

The possible move by UnitedHealth Group raises new questions about the viability of President Obama's signature health law and follows the departure of more than half of the non-profit insurance cooperatives this year. If UnitedHealth drops out, consumers would lose one of the lowest-cost plans available in much of the country, and some wonder how smaller insurers could fill the void. .

“If they can’t make money on the exchanges, it seems it would be hard for anyone,” said Katherine Hempstead, who heads the insurance coverage team at the Robert Wood Johnson Foundation.

UnitedHealth (UNH) downgraded its earnings forecast, bemoaning low growth projections for Obamacare enrollment and blaming the federal health care law for giving individuals too much flexibility to change plans. People who purchase insurance through the public exchanges are typically heavy users of their plans, draining insurers' profits, analysts say.

In a sharp reversal of its previously optimistic projections, UnitedHealth suspended marketing of its Obamacare exchange plans for 2016 — which the company has already committed to offer — to limit its exposure to additional losses.

“We see no data pointing to improvement" in the financial performance of public-exchange plans, UnitedHealth CEO Stephen Hemsley said on a conference call, though he added that "we remain hopeful" the market will recover.

FINISH READING this at: USAtoday

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