Marketplace Premiums and Insurer Participation: 2017-2020

Brief

Marketplace Premiums and Insurer Participation: 2017-2020

Abstract

In this paper, we show the changes in average lowest silver premiums from 2017 to 2020 by state and in the lowest silver premiums offered by each insurer in selected markets. Following uncertainty and regulatory changes in 2018, including the administration’s decision to stop reimbursing insurers for cost-sharing reductions and widespread fear that the administration would not enforce the individual mandate, the average number of participating insurers dropped from 3.7 per region to 3.0 per region. Though some observers expressed concern that 2018 premium increases would begin a slow decline of the marketplace, premiums began to stabilize: lowest silver premiums decreased on average by only 0.4 percent nationwide in 2019, and decreased on average by 3.5 percent nationwide in 2020. We also examine insurer entrances and exits in 29 selected markets and find increased insurer participation in 2019, with an average of 3.3 insurers per region, and 2020, with an average of 3.9 insurers. This suggests that many insurers now believe these markets are stable, functional, and potentially profitable.
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