In a major blow to Obamacare, one of America’s largest health insurers said it was pulling out of most of the markets in which it was participating, citing huge losses in the past quarter.
In a statement Monday, Aetna reported that it lost $200 million in the second quarter of 2016 and as a result would participate next year in just four states’ Obamacare marketplaces: Delaware, Iowa, Nebraska and Virginia.
Aetna had been offering health-insurance plans in 15 states’ Obamacare markets this year, but its retreat mirrors moves by several other major health-insurance providers in recent months.
“As a strong supporter of public exchanges as a means to meet the needs of the uninsured, we regret having to make this decision,” Aetna CEO Mark Bertolini said.
Some conservative critics of Obamacare, and even some liberal advocates who favored socialized medicine, predicted that private insurance companies would mitigate their exposure to a potential “death spiral.”
Under that scenario, as coverage protections kicked in, sicker patients would sign up and take advantage of taxpayer-funded subsidies to help them pay the premiums, yet healthier patients would figure it made more financial sense not to buy expensive plans but pay Obamacare’s newly mandated fines instead.