Biggest Insurer Drops Caution, Embraces Obamacare

“UnitedHealthcare, the insurance giant that largely sat out the health law’s online marketplaces’ first year, said Thursday it may sell policies through the exchanges in nearly half the states next year.
“We plan to grow next year as we expand our offering to as many as two dozen state exchanges,” Stephen Hemsley, CEO of UnitedHealth Group, the insurance company’s parent, told investment analysts on a conference call. He was referring to coverage sold to individuals.
The move represents a major acceleration for the company and a bet that government-subsidized insurance, sold online without regard for pre-existing illness, is here to stay. UnitedHealthcare sells individual policies through government exchanges in only four states now.
Even analysts who follow the company closely seemed surprised.
“You’re making a really big move,” Kevin Fischbeck, an analyst for Bank of America, told the company’s executives. “You’re going to do a couple dozen states. You’ve really moved in. What’s giving you the confidence … that it’s going to be stable next year?”
The answer, the bosses said, is that the marketplaces look sustainable, even without some of the reinsurance and risk-spreading backstops put in place for carriers in the first few years. They know the prices now, they said. They know the regulations. They know how consumers are behaving.”