The mass exodus of UnitedHealth from 22 states this week threatens to severely damage competition and leave nearly 1 million consumers without a single health plan option, a forecast from Kaiser Family Foundation has found.
Released Monday, the analysis suggests the UnitedHealth pullout will be felt most in the South and Midwest, where consumers already have few plan choices. If the insurer follows through on its threat to leave all state markets by 2017, the effect would be even worse.
In fact, more than one in four counties where UnitedHealth participates would see a drop from two insurers to just one if another insurer does not step in to take its place. A similar number would drop from three insurers to two. Those changes would affect 1.1 million people and 1.8 million, respectively.
Those most affected by the withdrawal include Kansas and Oklahoma, where just one insurer would be available in the entire state.
Other potential impacts include almost two-thirds of enrollees in Alabama having just one choice of insurer, and the remaining 33% would have two.
In Mississippi, 43% of enrollees would have a single insurer and 57% would have two. Arkansas residents would have a choice of three insurers, down from four, and in Georgia, 8% of total insurers would have a choice of just two insurers.
Regardless, the effect on premiums and number of plan options should be “modest” for most of the 34 states UnitedHealth operates in this year, Kaiser said.
According to the Kaiser analysis of 2016 insurer premiums, the company was less likely to offer one of the lowest-cost silver plans – the most popular on the exchanges. The lower cost options it did offer was not markedly different than its competitors, which means the weighted average premium for a silver-level plan would have been just 1% higher if UnitedHealth had not participated this year.
The insurer’s move comes after executives publicly decried the hundreds of millions it said it was losing on Obamacare plans. It began notifying states of its decisions earlier this week, in advance of the May deadline.
So far, UnitedHealth is the only large carrier to leave the Obamacare market in multiple states.
“We have full confidence, based on data, that the marketplaces will continue to thrive for years ahead,” a spokesperson for the US Department of Health and Human Services said. “The marketplace should be judged by the choices it offers consumers, not the decisions of any one issuer.”
