Blue Cross Blue Shield of Nebraska loses $140 million in Obamacare, will exit market

Citing a loss of $140 million in the Affordable Care Act marketplace over the past three years, Blue Cross Blue Shield of Nebraska has announced it will exit the Obamacare market in 2017.

BCBS of Nebraska said it received an approved rate increase of 34.7 percent for the 2017 plan year, but it was not enough to make up for its losses on the exchange market or the lack of promised federal funds from the risk corridors program.

Congress has funded only 12.5 percent of the risk corridors program, according to the insurer.

Other insurers, including Aetna, which left the ACA market in several states, place blame on the risk corridors program for putting them in the red on exchange plans.

[Also: ConnectiCare announces intent to remain in state's Obamacare market]

"Even with the approved rate increase we recently received from the Nebraska Department of Insurance, our projections show a significant and continual loss of money on these plans," BCBS of Nebraska said in a statement. "BCBSNE lost $64 million in 2015 because of high claims from customers covered under an ACA-compliant individual plan and the failure of the federal government to fully fund the program."

BCBS of Nebraska's decision cuts the number of insurers offering products on that state's exchange from four in 2016 to two in 2017, according to the Nebraska Department of Insurance.

Medica and Aetna will be selling on the exchange for Nebraska in 2017. They'll also be selling those same products off of the exchange. 

Aetna remains on the exchange in Nebraska despite announcing it was exiting nearly all of the states where it currently participates. Nebraska is among four states where Aetna will offer exchange products for 2017, healthinsurance.org said.

[Also: Obama asks remaining exchange insurers for help]

UnitedHealthcare, which sold an exchange plan in Nebraska in 2016, will not offer plans in 2017. It announced earlier this year that it was leaving most of the exchanges in the 34 states where it currently offers plans.

BCBS of Nebraska said it would reconsider entering the market for 2018 if changes are made to the law to stabilize the market.

BCBS of Nebraska recommends the government take three key steps: Enforce the special enrollment periods to stop consumers from signing up for coverage only when they need it and dropping it when they don't; Change the risk pool to make it as large as possible for the age rating slope to be steeper, so that more young and healthy consumers enroll; and give states more control over plan benefit design.

"Serious issues with the health care law have made the public Marketplace unstable, which is driving increased costs and decreased competition and consumer choice," BCBS of Nebraska said. "Without changes in the law, we don't see the Public Marketplace stabilizing, and costs will continue to increase for both insurers and consumers."

BCBS of Nebraska will continue to offer bronze and catastrophic individual plans on the private market through either a licensed agent or its website, it said.

[Also: Bernie Sanders, Elizabeth Warren grill Aetna about Obamacare exit]

Two other companies are also selling products off of the exchange market in 2017: Enterprise Life Insurance and Freedom Life Insurance Company of America, according to the insurance department.

Also members covered under one of the grandfathered plans BCBS of Nebraska was allowed to retain as part of the President's "Keep Your Plan" promise, will also not be affected by the decision to leave the exchange market. 

Open enrollment begins November 1.

Twitter: @SusanJMorse