WASHINGTON (CBSDC/AP) — UnitedHealth CEO Stephen Hemsley says the nation’s biggest health insurer made a bad decision when it dove deeper into the Affordable Care Act’s public insurance exchanges this year.
Hemsley says the insurer should have waited and learned more about the still-new business before jumping into two dozen state-based exchanges for 2015. That move ultimately generated losses steep enough to force the company to chop its earnings forecast. UnitedHealth Group Inc. sold coverage on just four exchanges in 2014.
“It was for us a bad decision,” Hemsley said about Obamacare, according to Bloomberg Business. “I take accountability for sitting out the exchange market in year one so we could in theory observe, learn and see how the market experience would develop. This was a prudent going-in position. In retrospect, we should have stayed out longer.”
The Minnetonka, Minnesota, company will decide next year whether to sell coverage for 2017 on the exchanges, a key element in the ACA’s push to cover millions of uninsured people.
“It will take more than a season or two for this market to develop,” Hemsley said. “We did not believe it would form this slowly, be this porous, or become this severe.”
But Hemsley also told investors Tuesday that any decision to pull back from that market will not be permanent.
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