Health insurance exchanges will likely create "fairly competitive" marketplaces as insurers vie for consumers, says a new report from the Robert Wood Johnson Foundation (RWJF).
"Our central conclusion is that there will be robust competition in many states and this will lead to reasonably priced premiums, with lower premiums for unsubsidized enrollees and lower subsidy costs to the federal government," the authors wrote in the report.
In analyzing exchange markets in six states--Colorado, Maryland, New York, Oregon, Rhode Island and Virginia--the Robert Wood Johnson Foundation decided that the competitiveness of the markets will lead to "reasonably well-priced premiums, at least after the first year when much of the uncertainty has subsided."
A major factor in determining how insurer competition actually impacts premiums is whether insurers can successfully create narrow networks that meet provider network standards and provide enough coverage to attract consumers. Overall, the report found the six states are "very accommodating to insurers" when dealing with provider networks and service areas. Plus, the states haven't aggressively negotiated with insurers over their proposed premiums.
It noted, however, that none of the states were sure how consumer-operated and oriented plans (CO-OPs) or multi-state plans will affect exchange competition.
"For insurance exchanges to truly benefit consumers' pocketbooks, there needs to be adequate competition among participating insurers to keep prices reasonable," said Andy Hyman, who leads coverage programs at RWJF. "Fortunately, the early tea leaves suggest that insurers are eager to participate by providing high-quality, reasonably priced plans in the new insurance marketplaces."
To learn more:
- here's the RWJF report