Obamacare, unsustainble

UnitedHealth Group Inc. said profit declined in its latest quarter as the biggest U.S. health insurer struggles with its health-care exchange segment.

The Minnetonka, Minn., company in November said it had suffered major losses on policies sold on the Affordable Care Act's exchanges in 2015, and warned that those losses would continue this year. Exchanges represent a small share of UnitedHealth's overall membership and revenue, but UnitedHealth said it booked a $245 million loss in the fourth quarter for advance recognition of 2016 losses.

UnitedHealth said the exchanges contributed to the company's consolidated medical-care ratio--the amount of premiums used to pay patient medical costs--rising to 82.7% in the fourth quarter, up from 80.9% in the third quarter and 80.1% in fourth quarter 2014. In addition, the company set aside $95 million in reserves for expected losses stemming from a state Medicaid contract.