UnitedHealth Threatens Departure from ACA Exchanges

I’ve been thinking about the implications of UnitedHealth Group’s recent announcement to reduce its exposure on the healthcare exchanges.

The company’s CEO Stephen Hemsley said UnitedHealth had sustained heavy losses this year from policies on the exchanges, and as a result, will stop marketing efforts for 2016 plans and will cut commissions to brokers in efforts to limit the number of enrollees in exchange plans next year. He also indicated that the company is considering complete withdrawal from the marketplace in 2017.

This announcement comes just weeks after UnitedHealth took a much more optimistic stance in its financial outlook for the exchanges. Hemsley gave little indication of what spurred the company to change its plans so dramatically in such a short period of time.

Reaction to the announcement has been predictably mixed along political lines. Opponents see UnitedHealth’s announcement as just another indication that the ACA is seriously flawed legislation and must be repealed. Supporters point to UnitedHealth’s guarded entry into the marketplace as a reason for its disappointing performance, as well as Blue Cross Blue Shield’s stated commitment to covering individuals on public exchanges as an example of the law’s support. They point to the number of people enrolled as an indication of its popularity and predict success.

What, however, does the controversy surrounding the ACA mean for healthcare organizations?

First of all, I think the mandate of better care for individuals, better health for populations, and lower costs for healthcare overall will remain central to the entire healthcare system. Repeal of the ACA will not fix the underlying problems it was designed to correct, and I don’t think returning to a pre-ACA environment is either possible or effective. 

Secondly, healthcare organizations must be proactive in helping patients and employees, as well as the organization itself, thrive. We have seen notable examples of better outcomes and lower costs from some of the innovative programs being tested right now. I believe that early adoption of effective programs will give healthcare systems the best chance for capitalizing on the changing environment.

We know that data is essential. We know that care-delivery models must be adapted. We know that payment models are changing and bundled payments are on their way next year. We know effective leadership is critical to success. Those are some of the givens.

We must continue along the path we have begun. It seems to me that providing better care at reasonable costs is an effective goal regardless of changes that may be on the horizon.

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