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. 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. Aetna had approximately 60,000 people covered by individual policies as of March 31, 2013, and it projects it will have approximately 50,000 people covered by individual policies at the end of 2013, when the company exits the individual market. United Healthcare, through its subsidiary PacifiCare, had approximately 10,000 individual policyholders late in 2012. Policyholders from both companies have been informed they can keep their existing health insurance until December 31, 2013. Aetna and United Healthcare policyholders will be able to purchase health insurance from other health insurers inside and outside the new California health benefits exchange. 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.