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August 18, 2015

Study: ACA’s Individual Insurance Market Reforms Seem to Be Working

Early predictions that health plans sold through the Affordable Care Act’s insurance marketplaces would attract a higher share of people with costly health problems have not been realized, a new Commonwealth Fund study finds.

To see whether the ACA’s reforms of the individual market are working to promote competition based on value instead of insurers’ ability to segment consumers based on their health risk, Michael McCue of Virginia Commonwealth University and Mark Hall of Wake Forest University compared plans sold on and off the exchanges. They found that plans featuring more generous benefits, which appeal to people with health problems, are more commonly sold off the exchanges rather than on.

Moreover, projected administrative costs and profit margins are higher for insurers operating outside the marketplaces—“a testament to the exchanges’ ability to sell coverage efficiently,” the researcher say.

Read the brief

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