SACRAMENTO, Calif. -- A second health insurer notified state regulators Tuesday that it will stop selling individual policies in California.


UnitedHealthcare announced it will no longer offer individual insurance plans after the end of the year. It will focus instead on its core business of group plans for large and small employers.


"Our individual business in California has always been relatively small and we currently serve less than 8,000 individual customers across the state," the company said in a statement. "Over the years, it has become more difficult to administer these plans in a cost-effective way for our members in California."


The announcement comes two weeks after Aetna Inc. said it also plans to exit California's individual insurance market. Both insurers avoided participating in the state exchange that is being established as part of the Affordable Care Act.


State Insurance Commissioner Dave Jones says the departure of UnitedHealthcare and Aetna is bad news for consumers.


"While both UnitedHealthcare and Aetna have a very small share of California's individual health insurance market, their departure means less choice, less competition, and more market consolidation by the remaining big three health insurers – Anthem Blue Cross, Blue Shield of California, and Kaiser – which means an increased likelihood of even higher prices from those health insurers downstream," Jones, a Democrat, said in a statement.


According to 2011 figures compiled by the California HealthCare Foundation, Anthem Blue Cross, Blue Shield and Kaiser have 87 percent of the individual market.


Starting Oct. 1, those seeking to buy their own health insurance will be directed to Covered California, the state's new exchange, where 13 insurance carriers will sell individual policies.


Aetna and UnitedHealthcare chose not to participate in the exchange.


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  • 1912


    Former President Theodore Roosevelt champions national health insurance as he unsuccessfully tries to ride his progressive Bull Moose Party back to the White House. (Photo by Topical Press Agency/Getty Images)




  • 1935


    President Franklin D. Roosevelt favors creating national health insurance amid the Great Depression but decides to push for Social Security first. (Photo by Keystone/Getty Images)




  • 1942


    Roosevelt establishes wage and price controls during World War II. Businesses can't attract workers with higher pay so they compete through added benefits, including health insurance, which grows into a workplace perk. (Photo by Hulton Archive/Getty Images)




  • 1945


    President Harry Truman calls on Congress to create a national insurance program for those who pay voluntary fees. The American Medical Association denounces the idea as "socialized medicine" and it goes nowhere. (Photo by Keystone/Getty Images)




  • 1960


    John F. Kennedy makes health care a major campaign issue but as president can't get a plan for the elderly through Congress. (Photo by Keystone/Getty Images)




  • 1965


    President Lyndon B. Johnson's legendary arm-twisting and a Congress dominated by his fellow Democrats lead to creation of two landmark government health programs: Medicare for the elderly and Medicaid for the poor. (AFP/AFP/Getty Images)




  • 1974


    President Richard Nixon wants to require employers to cover their workers and create federal subsidies to help everyone else buy private insurance. The Watergate scandal intervenes. (Photo by Keystone/Getty Images)




  • 1976


    President Jimmy Carter pushes a mandatory national health plan, but economic recession helps push it aside. (Photo by Central Press/Getty Images)




  • 1986


    President Ronald Reagan signs COBRA, a requirement that employers let former workers stay on the company health plan for 18 months after leaving a job, with workers bearing the cost. (MIKE SARGENT/AFP/Getty Images)




  • 1988


    Congress expands Medicare by adding a prescription drug benefit and catastrophic care coverage. It doesn't last long. Barraged by protests from older Americans upset about paying a tax to finance the additional coverage, Congress repeals the law the next year. (TIM SLOAN/AFP/Getty Images)




  • 1993


    President Bill Clinton puts first lady Hillary Rodham Clinton in charge of developing what becomes a 1,300-page plan for universal coverage. It requires businesses to cover their workers and mandates that everyone have health insurance. The plan meets Republican opposition, divides Democrats and comes under a firestorm of lobbying from businesses and the health care industry. It dies in the Senate. (PAUL J. RICHARDS/AFP/Getty Images)




  • 1997


    Clinton signs bipartisan legislation creating a state-federal program to provide coverage for millions of children in families of modest means whose incomes are too high to qualify for Medicaid. (JAMAL A. WILSON/AFP/Getty Images)




  • 2003


    President George W. Bush persuades Congress to add prescription drug coverage to Medicare in a major expansion of the program for older people. (STEPHEN JAFFE/AFP/Getty Images)




  • 2008


    Hillary Rodham Clinton promotes a sweeping health care plan in her bid for the Democratic presidential nomination. She loses to Obama, who has a less comprehensive plan. (PAUL RICHARDS/AFP/Getty Images)




  • 2009


    President Barack Obama and the Democratic-controlled Congress spend an intense year ironing out legislation to require most companies to cover their workers; mandate that everyone have coverage or pay a fine; require insurance companies to accept all comers, regardless of any pre-existing conditions; and assist people who can't afford insurance. (Alex Wong/Getty Images)




  • 2010


    With no Republican support, Congress passes the measure, designed to extend health care coverage to more than 30 million uninsured people. Republican opponents scorned the law as "Obamacare." (Mark Wilson/Getty Images)




  • 2012


    On a campaign tour in the Midwest, Obama himself embraces the term "Obamacare" and says the law shows "I do care." (BRENDAN SMIALOWSKI/AFP/Getty Images)