See update below.
This is some genuine bad news for Obamacare:
Minnesota’s largest health insurer, Blue Cross and Blue Shield of Minnesota has decided to stop selling health plans to individuals and families in Minnesota starting next year. The insurer explained extraordinary financial losses drove the decision. “Based on current medical claim trends, Blue Cross is projecting a total loss of more than $500 million in the individual [health plan] segment over three years,” BCBSM said in a statement.
….The decision will have far-reaching implications. Blue Cross and Blue Shield says the change will affect about, “103,000 Minnesotans [who] have purchased Blue Cross coverage on their own, through an agent or broker, or on MNsure.”
When United Healthcare closed up shop, it wasn’t that big a deal. UH is a huge insurer, but not a major Obamacare player. Blue Cross is different. It’s a huge insurer and a major player in the individual health care market.
If this is just a problem with Minnesota, it’s not too big a deal. If it’s a sign of broader Blue Cross problems nationwide—and Blue Cross has previously announced losses in Illinois, Michigan, and other states—then it’s a big deal indeed. Fasten your seat belts.
UPDATE: Apparently Blue Cross isn’t actually pulling out of Minnesota completely:
In a sign of continuing tumult in the health insurance industry, the state’s largest insurer said Thursday it will no longer offer its traditional suite of flexible and broad-reaching policies for those consumers who don’t get coverage through the workplace. Instead, Blue Cross and Blue Shield of Minnesota will sell only health plans with a narrow network, which limits patient coverage to specific doctors, hospitals and prescription drug benefits.
….“It’s a very difficult decision for us,” said Michael Guyette, CEO of Blue Cross Blue Shield of Minnesota, who described the move as a “refocusing of our portfolio” rather than an all-out exit from the individual market.
So Blue Cross is staying in the individual market, but offering only narrow network plans. That’s still bad news for Obamacare, but not nearly as bad as Blue Cross leaving the market entirely.