How Much Competition is There in the ObamaCare Exchanges?

health-insuranceAt the state level, the exchanges are actually less competitive than the individual markets prior to ObamaCare. Comparing the number of insurers participating in the exchange with the number of carriers that previously offered individual coverage in each state, Edmund Haislmaier, my colleague at Heritage, found that nationally there is now 29 percent less insurer competition in the exchanges relative to the prior individual market. Only five exchanges feature more carriers offering individual coverage than in the pre-ObamaCare era.

Thus, there is even less insurer competition at the county level. In one of every six counties in America (17 percent), the state exchange offers only one insurer — a monopoly.  For another 35 percent of counties, only two insurers offer coverage. In another 25 percent, only three insurers are selling coverage. To recap, consumers in more than half of the nation’s counties can “pick” from only one or two insurers on an ObamaCare exchange. In more than three of every four counties, competition is limited to three or fewer insurers.

Alyene Senger.

Comments (15)

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  1. Thomas says:

    “…found that nationally there is now 29 percent less insurer competition in the exchanges relative to the prior individual market.”

    Which means that consumers are basically stuck with only a few choices, most of them being bad plans. Its a “pick your poison” kind of deal.

    • Bill B. says:

      So much for the claim of making health insurance more competitive.

      • Matthew says:

        They described them details of ObamaCare in the inverse order. Its not higher choice, lower premiums. Its lower choice, higher premiums.

      • Tommy T says:

        Less competitive and less affordable if pitched this way, many would have voted against this reform rather than support it.

  2. Paco H says:

    This is one of those cases in which statistics can be manipulated to proof contradicting points. Using the same information, the two authors came up with different conclusions. Who should we believe? Basically the choice boils down to your political views. If you support Obamacare you would argue it has fostered competition, if you don’t like ACA, you probably side with those who claim that this reform is creating monopolies in the industry. Again statistics depends on how you interpret them.

  3. James M. says:

    “Thus, there is even less insurer competition at the county level. In one of every six counties in America (17 percent), the state exchange offers only one insurer — a monopoly.”

    ObamaCare certainly doesn’t appeal to those who favor competition Mr. Sperling.

  4. Jesse P says:

    The stock markets reacted since this law was approved, causing the stock prices to spike. Today we are facing monopolies in the exchanges and realize why these stocks went up so much. In monopolies the producer’s surplus is maximized, meaning that their profits are high and sustainable, fair reason to have purchased the stock back in 2010.

  5. Peter A says:

    The reform made insurance less competitive in the national level, less competitive in the state level, even less competitive in the county level. This is how to fix a problem the wrong way, creating more problem than those that were solved.

    • Sam says:

      Actually I fail to figure out why the insurance becomes less competitive after the ACA is implemented. Exchange just provides a platform for people to select their own insurance plans, doesn’t it?

      • Frank J says:

        Less insurance companies offering coverage in a trading platform that facilitates collusion, leads to oligopolies (monopolies held by a few companies). If all coverage is provided by two or three parent companies, how can we claim there is competition in the market?

  6. Arron Hall says:

    Less number of competitors means expensive premiums that will shell out by the insurance companies from every American on the pretext of Obamacare. Well I got the way to save myself from this worst situation after watching this video on