The insurance choices for many people who select plans from the health insurance marketplace will become will become fewer in 2017. Aetna, one of the largest health insurance providers, announced that next year it would not offer plans in 11 of the 15 states where it offers coverage through the marketplace. It’s a dramatic shift from the company’s public sentiments expressed just months ago. In April, CEO Mark Bertolini described the Affordable Care Act to shareholders as a good investment, according to Vox. And as recently as May, the company was planning on expanding into five new markets.
Now Aetna’s strategy shift will leave the insurer in just four states starting next year. The reason, Vox explains, is that the company believes that these marketplace plans were losing the company too much money. The company attributes these financial losses to the markeup of its customer base. Too many of the enrollees were older and sicker, and thus more expensive to cover, according to Vox.
Aetna isn’t the only company pulling back on its coverage in certain states. Humana has also said that it withdraw from eight of the 19 states where it currently offers coverage, leaving it in just 11 states next year. The most dramatic change is coming from UnitedHealth Group. The company, which currently offers plans through the marketplace in 34 markets, now says that it will be in three or fewer markets next year, Slate reported. These insurance companies are all claiming reasons similar to those cited by Aetna. All five major health insurers now expect to lose money from plans offered on the federal marketplace, the Wall Street Journal reported. Aetna’s loss is projected to top $300 million.
Aetna’s decision will reduce competition in the states where it withdraws coverage. Competition was one of the main objectives of the Affordable Care Act. But it’s also possible that other insurers will step up to fill the void left by Aetna. The insurance companies that do choose to remain in the health insurance marketplace will likely adjust their insurance plans to better reflect the kinds of options that people are looking for. To stay on top of the latest developments regarding insurance plans available on the insurance marketplace, contact us.