United's departure from marketplaces could impact consumers' costs, access

UnitedHealthcare's decision to quit insurance exchanges in about 30 states next year has patient advocates concerned that fewer options could force consumers to pay more for coverage and have a smaller choice of network providers.

The company's departure could be felt most acutely in several counties in Florida, Oklahoma, Kansas, North Carolina, Alabama and Tennessee that could be left with only one insurer, according to an analysis by the Kaiser Family Foundation (KHN is an editorially independent program of the foundation).

To sell policies next year on the health law's exchanges, also called marketplaces, insurers must apply within the next few weeks and get state approval this summer.

Two counties in southwest Florida -- Lee and Collier -- will be most affected. With UnitedHealthcare's departure, the 80,000 consumers in those counties could be left with only one option: plans offered by Florida Blue, the Blue Cross and Blue Shield company. Two counties in Oklahoma -- Oklahoma and Tulsa -- which had about 60,000 enrolled on exchanges this year, could be left with only the Blue Cross and Blue Shield of Oklahoma, the Kaiser analysis found.

[Also: Harvard Pilgrim bullish on exchange business despite high-profile UnitedHealthcare exit]

Lynne Thorp, regional director of the Health Planning Council of Southwest Florida, which helps consumers enroll in plans, said the impact depends on how Florida Blue handles its monopoly. While most enrollees get subsidies that keep their monthly premium low, many are concerned about possible increases in copayments and other cost-sharing on physician visits and drugs. Florida Blue offered the plans with the lowest premiums in the region last year.

"Absolutely there are concerns with United leaving," said Andrea Stephenson, executive director of Health Council of Southeast Florida, which also assists consumers with enrollment. "Having another big carrier pull out of the market will be a real challenge," she said.

[Also: UnitedHealthcare to exit all but 'handful' of Obamacare markets in 2017]

While Florida Blue has a strong reputation, her group did hear complaints that the insurer did not offer enough choice of specialists. Without having a company compete against Florida Blue for exchange customers, Stephenson worries those networks could remain tight or get even narrower. If customers can't find a robust choice of doctors, they may decide to remain uninsured. "Even with the individual mandate, the value proposition has to be there," she said.

UnitedHealth Group cited escalating losses on the Obamacare plans -- $475 million in 2015 and $650 million expected this year -- as a reason the company planned to quit most marketplaces. United operated in 34 states this year but has committed to staying only in New York, Virginia and Nevada for 2017. United's independent subsidiary, Harken Health, is expected to continue operating in Atlanta and Chicago.

So far, UnitedHealthcare is the only large carrier to announce it was quitting the marketplaces in multiple states.

While UnitedHealth is the nation's largest health insurer overall, most of its business historically has not been in the individual market, which the exchanges serve.

Jodi Ray, director of Florida Covering Kids & Families, which has the largest federal navigator contractor in the state to conduct enrollment assistance, played down the impact of UnitedHealthcare leaving. "United is not a low-premium issuer … and most consumers are price driven," she said. "Consumers will adjust accordingly no matter who the issuer is."

[Also: United Health Foundation awards UNLV School of Medicine $3 million grant]

Denise Cyzman, executive director of the Kansas Association for the Medically Underserved, said UnitedHealthcare will be missed even though it only had about 10 percent of marketplace enrollees. She said she hopes another carrier comes in to give the Blue Cross and Blue Shield plan some competition. "It's good for consumers to have choice," she said.

Kansas Insurance Commissioner Ken Selzer is meeting with companies to try to entice one into the marketplace, a spokesman said.

Having just one insurer left in counties near Winston-Salem and Wilmington is concerning, said Sorien Schmidt, North Carolina director for Enroll America, but she's confident another player will step in. She said marketplace enrollment was still strong last year even after the Blue Cross plan raised rates an average of 32 percent. But she said the more companies in the marketplace, the better chance to drive down premiums and get the word out about options under the health law.

In Florida, Thorp said, the biggest challenge is still educating people that many can get government assistance to buy coverage. "It's still surprising how many people we find who don't know that."

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.