The largest U.S. health insurer is throwing in the towel on the majority of Obamacare exchanges, saying it is losing too much money for the business to be sustainable. Bobbi Rebell reports.
UnitedHealth is calling it quits on Obamacare. It says it will largely exit the individual insurance market in 2017, remaining in only a handful of states. It blames mounting losses for its move. UnitedHealth is the largest U.S. health insurer and one of the biggest sellers of plans on the exchanges. The company says it loses money because of the higher risk profile of new members, as well as the smaller than expected enrollment. But there's a bit more to the story says Caroline Humer who covers the company at Reuters: (SOUNDBITE) CAROLINE HUMER, HEALTH AND PHARMACEUTICALS CORRESPONDENT, REUTERS, (ENGLISH) SAYING: "They haven't traditionally sold to individuals. Some of their competitors like Anthem which operates Blue Cross Blue Shield plans, these are their customers. They know all about them. And they say they are not losing money on them. UnitedHealth different story. " But UnitedHealth is big, so Morningstar equity analyst Vishnu Lekraj says the move may prompt changes in Obamacare - and a return to the plans for the insurer. (SOUNDBITE) VISHNU LEKRAJ, EQUITY ANALYST, MORNINGSTAR, (ENGLISH) SAYING: "I fully expect UnitedHealth to start participating again once that management feels it is opportune for them. So they will give them some time here to see how things shake out, to see if the membership make up starts to improve and then they will start to move back in." While it may be losing money in Obamacare, UnitedHealth reported that its quarterly profits rose, and it raised its outlook for the full year.