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IU Analyst: Insurance Companies May Leave Obamacare If They Don't Make More Money

Andrew Malone

An Indiana University health policy expert says insurance companies might deal a big blow to Obamacare.

Last week, UnitedHealth Group, the nation's largest health insurer, said it might withdraw from the Affordable Care Act's health exchanges after next year if it was unable to turn around what it calls huge financial losses.

While state and federal exchanges only make up a small percentage of the company's business, United says it will lose $700-million on them this year and next.

Kosali Simon, who studies health policy at IU's School of Public and Environmental Affairs, says insurance companies are losing more money than they expected.

"One possibility is that they maybe were more optimistic about how they could manage the health care of these populations due to disease control management, and are now discovering that it is harder,” Simon says.

Many insurance companies raised premiums for 2016 in states such as Indiana that rely on the federal marketplace. Though the number of uninsured Americans has dropped under Obamacare, many are still not signing up for coverage - a July 2014 Gallup poll showed the uninsured rate at 13.4-percent. 

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