Carrier to exit federal health insurance market for key state next year

Scott & White Health Plan’s exit from the ACA marketplace mirrors the withdrawals of major national carriers

Life & Health

By Lyle Adriano

Texas regional carrier Scott & White Health Plan announced on its website Wednesday that it would stop offering health plans on the state’s marketplace next year.

The announcement comes just days after major insurer Aetna declared that it was withdrawing from the federal health insurance exchanges of all but four states; Texas is one of the states the insurer is pulling out from.

UnitedHealthcare, another major insurer, also said in April that it would withdraw from Texas’ exchanges next year.

All three health insurers have said that the reason for their exit is due to the heavy losses they incurred on the exchanges.

With Scott & White’s exit, Blue Cross and Blue Shield of Texas remains the largest insurer in Texas—the insurer has made no announcement of plans to withdraw next year. Blue Cross, however, is looking to increase its rates by almost 60% in some of its exchange plans in 2017.

Although Scott & White plans to stop offering federal exchange plans next year, it will continue to offer some individual and family bronze HMO plans off the exchange, the company said Thursday.

"Scott & White Health Plan is committed to offering affordable, quality health insurance options in Texas," Scott & White Health Plan CEO Jeff Ingrum told Houston Chronicle via email. "We regret that in 2017, we will be unable to offer plans through the Health Insurance Marketplace. We will continue to assess our ability to participate in the future, as this is a changing environment."

Scott & White’s exit could have larger ramifications than Aetna’s, claimed Texas A&M University School of Public Health professor and head of the health policy and management department Michael Morrisey.

"This is an organization that understands HMOs in Texas," Morrisey explained. "The fact that they are saying they can't make money on the exchange says something about the nature of who is enrolling in the exchange plans."

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