UnitedHealthcare's pullback from government-run health insurance exchanges includes vacating the online marketplace for California, state regulators announced Tuesday.
Minnetonka-based United currently competes on exchanges in 34 states, but it announced in April that it would sell coverage next year in just a handful because of financial losses.
UnitedHealthcare is the nation's largest health insurer, but the company was new to California's exchange in January.
"United currently has enrollment of about 1,200 members which accounts for less than one-tenth of a percent of our 1.4 million consumers," James Scullary, a spokesman for Covered California, wrote in an e-mail. "This is primarily because of the limited regions where they are offered and the fact that they have the second-highest or highest price point in three of the five regions."
United is the health benefits division of UnitedHealth Group, which is Minnesota's largest publicly traded company. The insurer's moves on the exchanges are being closely watched as an indicator for the health of the marketplaces, which were launched under the federal Affordable Care Act.
While there have been concerns nationally that those signing up for exchange coverage have used more care than expected, the risk pool in California during 2014 was relatively healthy, said Cynthia Cox, a researcher with the California-based Kaiser Family Foundation.
Word of UnitedHealthcare's departures in some states has been followed by announcements of new entrants. In Kansas, for example, two new health insurers including Minnetonka-based Medica are entering the market. In Iowa, the state's dominant Blue Cross and Blue Shield insurer plans to enter the exchange for the first time in 2017.
"We will learn in July whether any new plans will join Covered California or if any of our existing plans will expand their coverage areas, as they did in 2016," Scullary wrote in an e-mail. "Meanwhile, barring any changes, consumers in the five regions where United is leaving will still have between two and four plan choices."
UnitedHealthcare has not listed the states where it will continue selling exchange coverage, but has previously confirmed pullbacks in roughly two dozen states to media outlets.
During the open enrollment period that ended Jan. 31, California had the nation's second-largest sign-up tally, with about 1.57 million people selecting a private health plan.
The number currently enrolled through the exchange is lower because of lapsed policies, which aren't uncommon and occur as people find other coverage or simply stop paying their bills.
The state with the largest sign-up tally was Florida, with about 1.7 million people selecting plans.
Florida regulators announced last month that UnitedHealthcare would be departing for 2017.
Across all the exchanges, about 12.7 million people signed up for private coverage this year during open enrollment. When United announced its pullback, company officials said the insurer had about 795,000 people in exchange coverage — roughly 6 percent of the total.