Study: UnitedHealthcare's Exit From Government Marketplaces Could Increase Obamacare Premiums
Premiums Could Increase 6 Percent to 19 Percent in Certain Counties
MOUNTAIN VIEW, CA--(Marketwired - Apr 19, 2016) - A study by AgileHealthInsurance.com shows unsubsidized premiums in certain counties could rise dramatically with UnitedHealthcare's exit from Obamacare exchanges after 2016. UnitedHealthcare, the largest health insurer in the United States, said today it will limit its participation in public exchanges next year to a "handful" of states due to the poor financial performance of its Obamacare exchange plans.
In December, AgileHealthInsurance analyzed the costs for on-exchange Obamacare plans from UnitedHealthcare and other insurers in the 38 states using HealthCare.gov. The analysis, based on 2016 data, shows that UnitedHealthcare often offers the lowest-cost bronze, silver or gold plan. In fact, in counties where UnitedHealthcare sells the least expensive option, premiums for the lowest-cost plan would increase 6 percent-19 percent for unsubsidized consumers, depending on the metal level, if UnitedHealth exits the market.
"Several large insurers have struggled to make exchanges plans work financially, which suggests they may request unprecedented rate hikes for 2017 or, like UnitedHealthcare, exit various state exchanges," said Sam Gibbs, executive director of AgileHealthInsurance.com. "The millions of Americans who lack government or employer subsidies for health insurance will be most vulnerable in this market."
Silver plans are the most popular type of Obamacare plan with 67 percent of enrollees selecting them during the 2015 open enrollment period. In the coverage areas where UnitedHealthcare sells the least expensive silver plan, the price of the least expensive silver plan would increase 10 percent if UnitedHealthcare exits Obamacare exchanges and current or new carriers do not enter the exchanges with similarly priced products. In dollars, the monthly price of the least expensive silver plan would increase by the following amounts:
- Age 30: $26.41 per month increase
- Age 40: $29.74 per month increase
- Age 50: $41.57 per month increase
- Age 60: $63.16 per month increase
A recent study by HealthPocket Inc. estimated that up to 33 million people nationwide are in the unsubsidized health insurance market, where they lack premium assistance from the government or employers.
AgileHealthInsurance is the Internet's first site dedicated to helping consumers understand the benefits of term health insurance. These plans are the culmination of extensive research on health insurance needs in the Affordable Care Act era. AgileHealthInsurance also provides best-of-class plan comparison and online enrollment tools to accompany these new plans. Additional information can be found at www.AgileHealthInsurance.com.
AgileHealthInsurance.com is a Silicon Valley-based technology company and independently managed division of Health Insurance Innovations, Inc. (NASDAQ: HIIQ). This press release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans and projections regarding new markets, products, services, growth strategies, anticipated trends in our business and anticipated changes and developments in the United States health insurance system and laws. Forward-looking statements are based on our current assumptions, expectations and beliefs are generally identifiable by use of words "may," "might," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue," or similar expressions and involve significant risks and uncertainties that could cause actual results, developments and business decisions to differ materially from those contemplated by these statements. These risks and uncertainties include, among other things, our ability to maintain relationships and develop new relationships with health insurance carriers and distributors, our ability to retain our members, the demand for our products, the amount of commissions paid to us or changes in health insurance plan pricing practices, our ability to integrate our acquisitions, competition, changes and developments in the United States health insurance system and laws, and our ability to adapt to them, the ability to maintain and enhance our name recognition, difficulties arising from acquisitions or other strategic transactions, and our ability to build the necessary infrastructure and processes to maintain effective controls over financial reporting. These and other risk factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are discussed in HIIQ's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) as well as other documents that may be filed by HIIQ from time to time with the Securities and Exchange Commission, which are available at www.sec.gov. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. You should not rely on any forward-looking statement as representing our views in the future. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.