Insurers Have Left the Building
Health insurance companies are leaving a key marketplace in droves. Will part-time workers and contractors run for the hills?
In the Pacific Northwest, two insurers left the Affordable Care Act marketplace in quick succession—one closing down its health insurance arm altogether. Last year, a large insurer exited nationwide; this year another followed suit. The trend shows no signs of reversing.
Executives are already on high alert about healthcare costs, with CFOs listing them as a top-three concern in 2026. Now executives’ eyebrows are at their hairlines as they watch payers exit ACA exchanges. The shifting ACA market does not directly affect firms, but the indirect impact is profound. “Businesses are certainly exposed here,” says Scott Sette, senior client partner in the global healthcare services practice at Korn Ferry.
Insurers aren’t pulling out of ACA exchanges altogether, says Sette. Rather, they’re looking at the exchanges on a region-by-region basis and pivoting away from markets that aren’t profitable. In many of those markets, overall enrollment is declining, and the future of subsidies is uncertain.
Why does this matter to employers? The ACA markets are a critical coverage backstop for part-time workers, contractors, and early retirees, as well as the employees of small businesses. When part-time and freelance workers have an increasingly difficult time accessing health insurance, their employers risk losing workers as they seek jobs with benefits.
Experts say that the situation is like watching someone slowly pull a tablecloth off a table while insisting that nothing will spill. “It’s an indication of volatility,” says Liz Bickley, chief operating officer of Korn Ferry Health. Employers will undoubtedly feel the impact in multiple ways. For example, payers facing low profits in the ACA portions of their business are likely to raise premiums on other customers.
CFOs can also expect further headaches in dealing with payers. Some insurers are shutting down regional operations altogether, and the employers who worked with those firms are in the unexpected position of rebidding for their employees’ health insurance next year. Meanwhile, those markets now have less local competition and more powerful individual insurers. In some markets, a handful of insurers are operating in both the commercial and ACA markets. “The reality is that they can do what they want,” says Bickley. Reduced competition means reduced incentive to keep pricing in check or service levels high, leaving employers with fewer options and less leverage at the negotiating table.
But experts say firms also have an opportunity As obtaining health insurance becomes increasingly difficult outside the workplace, job candidates will find insurance to be increasingly valuable—in some cases, far more valuable than its cost to employers. After all, what’s the value of a sought-after service that is largely inaccessible? The answer, for savvy employers, is considerable. Thus, firms can harness health insurance benefits as a strong lever in both hiring and retention, says Bickley. In a market where coverage is harder to come by, the employer who offers it well stands out.
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