Study: ObamaCare has mixed record on spurring competition

The ObamaCare marketplaces have spurred increased competition among the largest insurers in two of the states with the most enrollees while reducing competition in some smaller states, according to a new study.


The Kaiser Family Foundation analysis released on Monday looked at seven states running their own exchanges and compared the percentage market share held by the largest insurers in those states before and after the ObamaCare rollout.

California and New York, which rank first and third in the nation in enrollees, have seen their largest insurers taking a smaller percentage of the market share, while smaller insurers have gained.

This increased competition could mean lower prices for consumers in the future.

In California, Wellpoint’s market share fell from 47 percent in 2012 to 30 percent in 2014, while Blue Shield jumped from 19 percent to 29 percent. Kaiser Permanente is third in the state at 18 percent; Health Net is fourth, having jumped from 3 percent to 18 percent; and a handful of other insurers accounts for 10 percent.

New York has an even more competitive market, with the number of insurers claiming at least 5 percent market share growing from five to seven.

Nevada’s marketplace has also become more competitive.

But the same can’t be said for all of these states.

In 2012, Connecticut had four insurers with at least five percent market share, and that’s been reduced to two in 2014. That’s largely because two of the largest insurers in the state, Aetna and United Health, opted not to participate in the exchange.

Washington, Rhode Island and Minnesota, meanwhile, have maintained relatively stable levels of competition.

According to Kaiser, when the Affordable Care Act was signed into law in 2010, 30 states and the District of Columbia had insurers that owned more than 50 percent of the market.

Because insurers can no longer discriminate based on pre-existing conditions, “premiums are easy to compare, focusing competition [among insurers] on price,” Kaiser said.

Markets with more firms competing with one another could push prices down for consumers in the long run.