Counting noses at the county level: Marketplace participation

There’s good news, and there’s bad news.

The bad news is that as of this writing 40 counties (across Indiana, Ohio and Nevada) have no insurers committed to sell exchange plans in 2018. Assuming we end the year with at least one insurer committed to each county, the overall picture will look something like this:

More counties will have only one insurer:

• The share of U.S. counties with one insurer will probably increase from about one-third to closer to 45 percent.
• In terms of people, while close to 20 percent of the population live in a county with one insurer now, it may be closer to 25 percent next year.

Fewer counties will have many insurers from which to choose:

• While almost a third of counties (31%) have three or more insurers now, that is projected to be more like 25 percent in 2018.
• The share of people living in counties with three or more insurers is projected to drop from about 60 percent to a little more than half next year.

Some state regulators have cajoled carriers into plugging the holes, and some observers think that behavior will continue.

A piece posted by RWJF argues that while we continue to count noses at the county level, we should be mindful of an important broad trend: “The role of national commercial insurers in the individual market will be truly negligible.”

Of the more than 700 county-level exits announced thus far this year, more than 65 percent came from national commercial carriers. Humana and Aetna have completely exited the exchanges, and United is virtually gone. Cigna will likely remain in a small number of states. Anthem, which functions as a blue plan, has also significantly pruned its participation in a number of states. At this writing, national commercial insurers (excluding Anthem) comprise less than 2 percent of county offerings. This continues but sharply accelerates a trend which began in earnest in 2015. Even that high point marked a notable decline from 2013.

Local plans that remain committed to the individual market at the state and county level have strong ties to those local markets, and are less likely to pull out. They are also more likely to have a good grasp of the market and to be able to perform well even under stress.

While it is undeniably critical that plans be offered in all counties, the bare counties tallied as of last week are home to just 0.4% of the U.S. population. Now that both the “repeal and replace” and “repeal now, replace later” legislative initiatives appear to have been derailed, perhaps the federales could focus on “repair and improve” initiatives designed to support the systems put in place by the ACA and that are now under siege by elements in the Administration and in Congress that are hostile to the ACA. Here’s hoping that the interests of constituents can come to the fore, and the rhetorical interests can take a back seat.

David Harlow
The Harlow Group LLC
Health Care Law and Consulting