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Anthem pulls out of Virginia Obamacare market, citing volatility and uncertainty

  • Anthem will pull out of Virginia's individual Obamacare market because of a "volatile" market and uncertainty from the federal government.
  • Earlier this summer, Anthem announced it would exit marketplaces in Wisconsin, Indiana and Ohio.
  • The insurer has until Sept. 27 to decide whether it will leave more exchanges.

Joseph Swedish, chief executive officer of Anthem Inc.
T.J. Kirkpatrick | Bloomberg | Getty Images
Joseph Swedish, chief executive officer of Anthem Inc.

Anthem announced Friday it will pull out of Virginia's "volatile" individual Obamacare market next year.

The insurer said planning and pricing have become increasingly difficult because of a shrinking market, as well as changes and uncertainty from the federal government. That includes President Donald Trump's indecision on whether to continue paying cost-sharing subsidies.

"While we are pleased that some steps have been taken to address the long term challenges all health plans serving the Individual market are facing, the Individual market remains volatile," Anthem said in a statement. "A stable insurance market is dependent on products that create value for consumers through the broad spreading of risk and a known set of conditions upon which rates can be developed."

Under the Affordable Care Act, insurance companies are required to pay subsidies to low-income consumers. These payments help these consumers offset the cost of premiums and co-payments.

In the past, insurance companies were reimbursed by the government for these payments, but their fate is uncertain. So far the Trump administration has continued to make these payments, but it can decide against that.

House Republicans last year successfully challenged the legality of the CSR reimbursements in federal court. The Obama administration appealed that decision and continued to make the payments while that case was being decided. However, under the Trump administration, the government could drop the appeal and halt the reimbursements.

Insurance companies are also wondering whether or not they will have to pay a tax. Its status is unclear as the president continues to press Congress to repeal and replace the ACA.

Amid this uncertainty, Anthem said Friday it will only offer off-exchange plans in two counties and one city in Virginia next year. The insurer's decision will not affect people with employer-based insurance, those who purchased insurance before March of 2010 or those enrolled in Medicaid or Medicare plans.

The company sells Blue Cross Blue Shield plans in 14 states, according to Reuters.

Virginia is the latest state where Anthem has decided to stop participating in Obamacare markets. Earlier this summer, the insurer announced it will exit Wisconsin, Indiana and Ohio next year. It cited "volatile" markets and "uncertainty" for each decision.

Last month, Anthem warned it may leave more marketplaces. It has until Sept. 27 to decide if it will exit more.

WATCH: Anthem to exit Ohio in 2018