Ailing insurance companies are finding it difficult to navigate a new and changing marketplace.
As companies struggle to maintain profits amid surging demand for coverage, they are being forced to pay hefty settlements to cover losses incurred by customers, who often have no recourse when they lose coverage.
The fallout from the insurance industry’s woes has hit all sorts of companies, from major insurers to small- and medium-size insurers, in a way that could shake up the business.
In the last two weeks, major insurers have filed for bankruptcy protection, and other insurers are looking to cut costs and sell their business.
But the damage has not been limited to the individual market.
Some insurers are considering selling or shutting down some businesses, including those that sell coverage for personal and small-business accounts.
They are also seeking bankruptcy protection or filing for Chapter 11 protection to restructure.
In the case of Anthem Blue Cross and Blue Shield of America, for example, a restructuring plan is expected to be approved by a judge in coming days, according to a person familiar with the matter.
Anthem, the largest U.S. health insurer by sales, has said it would consider selling assets to cover costs.
In a filing last week, the company said it was seeking to restructuring assets and reducing its workforce of about 6,000 people.
The filing did not address whether the company could sell some or all of its assets, such as assets related to its regional operations.
Anthem did not immediately respond to requests for comment.
The company’s chief financial officer, Jeff Jankovich, told analysts last week that the company would consider closing down some of its businesses in the future.
Jankich said in a conference call last week he expects the company to announce a plan to sell assets and reorganize later this year.
The plan could include selling some of the assets to help cover costs or some of them to fund an asset sale, Jankikson said.
The insurance industry is facing a wave of lawsuits, many stemming from the collapse of an insurance company that had been run by former President Donald Trump, who is facing multiple ethics charges stemming from his role in the presidential campaign.
The companies’ problems are also hurting the health-care delivery system.
As the market for health-insurance plans has grown, insurers are paying premiums to the states, who administer the program.
But many of those states are struggling to keep premiums down as insurers have faced more pressure to raise rates.
That has hurt enrollment and hurt the state-run exchanges, which offer subsidized coverage for people who can’t afford private insurance.
Insurers are now paying premiums for their coverage to individual insurers, which is not as much of a boon for consumers as it would be for a state-based marketplace, analysts say.
In a report this week, The Washington Post and Bloomberg News found that some of America’s largest insurers, including Aetna, UnitedHealth Group, and Humana, have been filing for bankruptcy in recent years, including one that is now insolvent.
That would mark the second time in less than two years that the companies have filed to file for bankruptcy.
Aetana, United Health and Humane are among the biggest U.s. insurers.
Jankovich told investors this month that Anthem Blue Shield had “not had any success in selling on the exchange.”
But the company’s filing said that “the company is evaluating additional options” for its health-in-insurer business.
A spokesperson for Anthem did NOT respond to an email seeking comment.
In some cases, insurance companies have gone after people for taking advantage of the Affordable Care Act’s protections for people with pre-existing conditions, including people with chronic illnesses.
For instance, Anthem is facing lawsuits in New York, Illinois and Texas from people who were denied coverage because they were diagnosed with a serious condition before they were legally able to get coverage.
In response to the lawsuits, Anthem has sought to settle more than 100,000 claims in the first three quarters of this year alone, according the company.
In March, the insurer paid $1.5 billion to settle lawsuits stemming from an ACA rule that would have allowed insurers to offer policies with pre-’03 coverage rules.
In another case, Anthem agreed to pay $7.2 billion to resolve lawsuits filed by former workers who alleged they were fired from their jobs because they sought to take advantage of Obamacare’s protections.
Anthem also reached a $9.3 billion settlement in November to settle claims from workers who said they were improperly paid for sick leave, a common practice in some states.
But the insurer is also facing scrutiny over the way it handles claims.
The Justice Department is investigating whether Anthem discriminated against some employees because they had pre-approved policies.
A spokeswoman for the department did not respond to a request for comment about the case.
Insurance companies also are grappling with how to handle rising costs of insurance and how to ensure they are paying