The organizations cited medical inflation, rising prescription drug costs, increased utilization, higher volumes of chronic conditions, and an increased demand for technology and broad networks as the reasons for scaling down their businesses.
“In recent years, the health insurance industry has changed dramatically, particularly for provider-owned insurers,” the companies said in a Feb. 25 news release. “Because of this, health plans, like Health Alliance and FirstCarolinaCare have struggled to achieve operational and financial efficiency.”
Health Alliance is a subsidiary of Urbana, Ill.-based Carle Health, an eight-hospital system. The health plan has more than 380,000 total members. In Illinois, it offers individual and employer group plans, individual and group MA plans, and Medicare supplement plans. In Indiana and Iowa, it offers employer group plans and MA plans. In Ohio, it offers only MA plans.
FirstCarolinaCare has more than 15,000 members and offers MA and employer group plans. It is jointly owned by Carle Health and Pinehurst, N.C.-based FirstHealth of the Carolinas, a 4-hospital system.