ACA Marketplaces More Competitive in 2019

But a new study shows people living in areas with only one or two plans pay significantly more for premiums than do people in more-competitive regions.

The Affordable Care Act's Marketplace plans got more competitive in 2019, but there are still more regions with only one or two plans to pick from, a new study suggests.

The number of people living in areas with five or more marketplace insurers increased by 8% in 2019, from 18.6% to 20.1%, according to the analysis by the Urban Institute and the Robert Wood Johnson Foundation.

At the same time, the analysis showed that the number of people living in areas with only one or two plans in 2019 dropped by 17%, from 45.1% to 37.5%, which the report said signals an increase in marketplace competition between 2018 and 2019.

However, the study found wide swings in plan availability depending upon geography.

More than 20% of Americans live in an area with five or more marketplace insurers, the 322 least competitive rating regions are disproportionately concentrated in less populated areas of the country, especially the South.

"It's encouraging to see signs of stabilization in the individual market," said Anne F. Weiss, managing director at the Robert Wood Johnson Foundation, in comments accompanying the study.

"However, geographic location still plays too great a role in consumers' coverage options and how much they cost. Everyone should have affordable health insurance options, regardless of where they live, given the impact of coverage on health," Weiss said.

Among the findings:

• The Northeast leads the nation in marketplace insurer competition, with a little more than 40% of its population living in areas with five or more marketplace insurers.
   
• In the South, only 4% of residents live in areas with five or more marketplace insurers, while a majority (just under 53%) live in areas with only one or two marketplace insurers.
   
• Approximately 26% of the population in both the West and the Midwest live in areas with five or more insurers, with 19% and 40% living in areas with only one or two insurers, respectively.

Consumers in areas with fewer marketplace insurers typically pay higher premiums. In 2019, the median benchmark silver plan premium for a 40-year-old non-smoker in regions with one insurer cost $592 per month compared to $376 per month in regions with five or more insurers, a difference of more than 36%.

GAO Study Sees Market Concentration

A separate study issued this month by the Government Accountability Office found that enrollment in private health insurance plans continued to be concentrated among a small number of health insurers in 2015 and 2016.

In the large group market, small group market, and individual market, the three largest commercial health insurance plans held 80% of the market or more in at least 37 of 51 states. The findings are similar to what GAO reported for 2011 through 2014.

GAO also found that within the overall individual and small group markets in each state, the health insurance exchanges established by the ACA were also concentrated from 2015 to 2017.

• For the individual market exchanges, in each year, three or fewer issuers held 80% or more of the market, on average, in at least 46 of the 49 state exchanges.
   
• The largest insurers increased their market share in about two-thirds of exchanges.
   
• For the small group market exchanges, in each year, three or fewer issuers held 80% or more of the market in at least 42 of 46 state exchanges.