Insurance giant Aetna is pulling out of most ObamaCare exchanges


On Monday, large health insurer Aetna said that it is withdrawing from the ObamaCare exchange markets in two-thirds of the 778 counties where it was participating, keeping all its exchange offerings in just four states: Delaware, Virginia, Nebraska, and Iowa. Aetna CEO Mark Bertolini said that "as a strong supporter of public exchanges as a means to meet the needs of the uninsured, we regret having to make this decision," but that its 838,000 exchange customers were sicker than anticipated, driving up costs and making the exchanges unprofitable. Other large insurers, including United Health and Humana, have also said they will scale back their involvement in the exchanges in 2017.
"It seems increasingly clear that big, national insurers are having trouble competing in the ObamaCare marketplaces and making money," said Larry Levitt at the Kaiser Family Foundation. "Some insurers are still doing well, particularly those that historically served Medicaid beneficiaries." Aetna said Monday that it has lost $430 million in its individual policy unit since January 2014, when the ObamaCare exchanges opened. Some 11 million Americans have insurance through the exchange marketplaces, and they are the only place where consumers can get federal subsidies, making them a key component of the Affordable Care Act.
Some allies of President Obama tied Aetna's withdrawal to the Justice Department's decision last month to block the company's planned merger with Humana, plus Anthem's acquisition of Cigna. As late as May, Aetna said it planned to expand its ObamaCare exchange options, Sen. Elizabeth Warren (D-Mass.) said on Facebook last week, after Aetna announced it was considering this withdrawal. "Aetna may not like the Justice Department's decision to challenge its merger, and it has every right to fight that decision in court," she said, but "the health of the American people should not be used as bargaining chips to force the government to bend to one giant company's will."
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Several large insurers have complained about the program's risk-adjustment apparatus. "I think the market will stabilize, and perhaps Aetna and United will come back," Washington and Lee University law professor emeritus Timothy Jost tells CNNMoney. "But the market really needs support for another few years until it does, and since the majority in Congress is rooting for [the Affordable Care Act] to fail, it seems unlikely that the support will be forthcoming."
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.
-
Ukraine: Trump's mixed messages
Feature Trump reverses a Pentagon freeze on Patriot missiles to Ukraine as Russia ramps up air attacks
-
Diddy: An abuser who escaped justice?
Feature The jury cleared Sean Combs of major charges but found him guilty of lesser offenses
-
Death from above: Drones upend rules of war in Ukraine
Feature The world's militaries are paying close attention to drone use in the Russia-Ukraine war
-
Dollar faces historic slump as stocks hit new high
Speed Read While stocks have recovered post-Trump tariffs, the dollar has weakened more than 10% this year
-
Economists fear US inflation data less reliable
speed read The Labor Department is collecting less data for its consumer price index due to staffing shortages
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off