Molina Healthcare Plans Further Reductions in ACA Business by 2027
Molina Healthcare announced its intention to further reduce its Affordable Care Act (ACA) business in 2027, citing ongoing financial pressures from a shrinking and sicker risk pool. The company's ACA membership has dropped significantly since the end of 2025 due to expired subsidies that led millions of Americans to leave the exchanges. Molina raised rates by an average of 30% but still underestimated medical costs tied to high-acuity members, particularly those with chronic conditions like HIV and cancer. The insurer plans to cut ACA premiums revenue by about $1 billion in 2027 as it narrows its focus to six states from the current 14. CEO Joe Zubretsky emphasized that Molina will continue reducing capital allocation until stability is achieved in the risk pool. The medical loss ratio for Molina's ACA business rose sharply, reaching 88.9% in Q2 of this year due to higher-than-expected costs and aggressive federal subsidy clawbacks. In contrast, Molina’s Medicaid segment remains stable as states increase payments to cover rising healthcare expenses.
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Topics: ACA cost management membership cuts Molina Healthcare premiums