Harken Health is quitting Obamacare exchanges in Chicago, Georgia

Harken Health Insurance, a subsidiary of UnitedHealth, announced Thursday it will not be selling plans in Chicago and Georgia in 2017. Business Insider reports:

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Harken had been launched in early 2016 to create tailored plans that would make money in the ACA, better known as Obamacare exchanges…

The firm said it will continue to offer plans in various states to individuals outside of the Obamacare exchanges.

Unlike other insurers who have left the exchanges, Harken does not appear to have offered an explanation for the change on its website. However, Modern Healthcare reports the reason is significant losses:

Harken Health started selling individual and group plans on and off the exchange in the two markets last January. It reportedly has about 35,000 members in those markets…

A Harken regulatory filing last month showed an operating loss of $69.9 million for the first half of 2016 and a “cash infusion” of $60 million from UnitedHealth in June.

So a loss of $70 million after less than a year in operation in just a few markets. Harken’s plan was to reduce costs for expensive treatments down the line by allowing all of its enrollees unlimited primary care visits with no co-pays and no deductibles. However those visits could only be with doctors at Harken’s own health clinics. One health broker told Modern Healthcare her clients didn’t like the idea of giving up their regular doctors:

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Susan Morris, an independent broker in Atlanta, said Harken “did a poor job of marketing the plan to agents and brokers.” In addition, she said her individual customers didn’t like the idea of giving up their regular primary care doctors and instead using Harken’s staff providers. And Harken didn’t have enough clinic locations to serve the large Atlanta market.

Harken is not the first innovative Obamacare start up to pull back from the exchanges. Last month Oscar Insurance announced it was leaving exchanges in Dallas, Texas and New Jersey.

Other more traditional insurers including UnitedHealth, Humana and Aetna have also pulled back from the exchanges this year.

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David Strom 3:20 PM | November 15, 2024
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