Major Insurance Company Ditches Obamacare In Kansas City

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Robert Donachie Capitol Hill and Health Care Reporter
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Blue Cross Blue Shield of Kansas City announced Wednesday morning it will no longer offer or renew insurance plans on the city’s Obamacare exchange next year in Kansas or Missouri.

The fallout is likely to affect some 67,000 Blue Cross customers in 30 counties in Kansas City, according to a statement from Blue Cross Blue Shield of Kansas City. The company provides insurance to over 1 million individuals in the Kansas City area.

Blue Cross customers who get insurance through their employers will not be affected, nor will customers who have “a Medicare supplement, Medicare Advantage, a Short-Term Policy or a Student Health Plan.”

The company is experiencing rising operating costs which have made it such that providing plans on the Kansas City Obamacare exchange is no longer profitable.

“Like many other insurers across the country, Blue KC has faced many challenges in this market,” the statement said. “Through 2016, the company lost more than $100 million in this market, which is unsustainable.”

Some 25 counties in western Missouri could be left without a single insurance provider on the Obamacare exchanges unless another provider steps in to fill the place of Blue Cross Blue Shield.

After Blue Cross made the announcement Wednesday, GOP Kansas Gov. Sam Brownback said the company’s withdrawal from the exchange was evidence that “Obamacare’s death spiral is growing worse.”

While the current state of Obamacare in Kansas City is concerning, Knoxville, Tenn. is another U.S. city where Obamacare could collapse, leaving tens of thousands of people without the option to buy a subsidized insurance policy. (RELATED: US City Set To See Complete Collapse Of Obamacare)

Humana, the city’s only remaining insurance provider on its Obamacare exchange, announced in early-April it is exiting the Obamacare marketplace in 2018. If that happens, Knoxville citizens will be in a rough spot. Unless another insurance provider fills Humana’s place, some 40,000 people in the Knoxville area will likely be left without the option to purchase an Obamacare-subsidized insurance policy.

Knoxville is illustrative of one of the main problems with Obamacare: It doesn’t promote market-based competition. Insurers pull out of marketplaces where it is not cost-efficient for them to provide services, and, as a result, consumers are left with fewer options at higher prices. (RELATED: White House: Obamacare Premiums Will Rise By Double Digits Next Year)

Tennessee is one of the largest casualties of the current health care system. Three insurers have pulled out of the state entirely, the state’s co-op failed and premiums continue to skyrocket annually by double-digits. Tennessee’s health commissioner has all but given up, describing the state’s health care system as “very near collapse.”

Some major insurance companies have stopped offering plans on Obamacare exchanges nationwide.

Aetna announced in early-May that it will stop offering Obamacare exchange plans in 2018, making it the latest major health insurance provider to completely opt out of former President Barack Obama’s landmark health care legislation. (RELATED: Aetna Ditches Obamacare Entirely)

The company cited massive losses among exchange participants and projects the problems to increase over the short term. Aetna will also cease to sell individual plans in Nebraska and Delaware.

Aetna is not the only insurance company leaving Obamacare exchanges. Humana announced in February that it will pull out of the exchanges entirely in 2018. It was the first major insurance provider to opt out of Obamacare under President Donald Trump.

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