A third major insurance company is having second thoughts about remaining in Obamacare after reporting serious financial problems.
Aetna said Tuesday it will not expand in Obamacare markets next year and is “undertaking a complete evaluation of future participation in our current 15-state footprint.” The reason is due to “significant structural challenges facing the public exchanges,” Aetna said in an earnings release Tuesday.
Aetna is the latest insurer to reveal financial headaches with Obamacare. Humana announced that it would exit Obamacare marketplaces in four states.
UnitedHealth has taken the furthest step backwards, deciding to exit a majority of the 34 states that it has Obamacare plans.
Aetna’s announcement is bad news for the Obama administration, which touted the company’s participation in Obamacare late last year when UnitedHealth announced it would exit Obamacare altogether. At that time, the Department of Health and Human Services noted that Aetna was saying it’s business was “unchanged,” and that Aetna expects to “see improvement in its exchange performance.”
Insurers have faced higher costs than they expected after setting premiums too low and facing a sicker-than-expected enrollment population. A recent study found that a majority of Obamacare insurers didn’t turn a profit in 2014, the first year the marketplaces went online.
However, some insurers are sticking with the marketplace. Cigna announced it is expanding to new Obamacare marketplaces and Anthem has said it remains committed to the program.
The administration said it remains highly confident in the marketplace.
“In the first year, the [Affordable Care Act] nearly doubled the size of the individual market, and the marketplace has continued to growth since then, creating major business opportunities for insurers who serve this market well,” said Marjorie Connolly, spokeswoman for the Department of Health and Human Services.
