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Nation’s largest health insurer pulling out of Tennessee’s Obamacare market

In this April 29, 2014, file photo, Stephen Hemsley, president and CEO of UnitedHealth Group, speaks at a news conference, in Southfield, Mich. Hemsley told analysts Tuesday, April 19, 2016, that his company cannot continue to broadly serve the market created by the Affordable Care Act's coverage expansion due in part to the higher risk that comes with its customers. UnitedHealth will remain in public health insurance exchanges in only a handful of states next year after expanding to 34 for 2016.
In this April 29, 2014, file photo, Stephen Hemsley, president and CEO of UnitedHealth Group, speaks at a news conference, in Southfield, Mich. Hemsley told analysts Tuesday, April 19, 2016, that his company cannot continue to broadly serve the market created by the Affordable Care Act's coverage expansion due in part to the higher risk that comes with its customers. UnitedHealth will remain in public health insurance exchanges in only a handful of states next year after expanding to 34 for 2016.

By Staff and Wire Reports 5 min read

UnitedHealthcare is pulling out of the Tennessee Obamacare health insurance market, only a year after announcing it would do business in the state.

The nation’s largest health insurer announced Tuesday that it would stop selling health plans through the Affordable Care Act next year in most of the 34 of states where it operates.

The decision means about 40,000 people in Tennessee who signed up for policies with UnitedHealthcare will be looking for a new insurance company for 2017.

Policies purchased in Tennessee from UnitedHealthcare for 2016 will be honored, and UnitedHealthcare policies obtained through an employer will not be affected by the announcement. UnitedHealthcare had about 15.5 percent of the Obamacare market in Tennessee.

Chattanooga-based BlueCross Blue Shield of Tennessee has dominated the market in Tennessee since the exchanges were launched four years ago, but has suffered large losses thus far and had to raise its rates significantly last year. Company officials have said they will seek another rate increase this year in attempt to make money on the exchanges.