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Competition in Marketplaces Cuts Health Insurance Costs

Competition among insurers in health insurance marketplaces (exchanges) is helping to lower plan premiums, research shows. A recent Bloomberg Government analysis evaluated individual plan premiums in each of the 36 states with a federally facilitated marketplace. The analysis found that plan prices in areas with 10 or more insurers are about a third lower than plan prices in areas with only one insurer. The association between greater competition and lower plan premiums was found to be consistent across age, plan type, and geography. Similarly, a research brief produced by the assistant secretary for planning and evaluation at the U.S. Department of Health and Human Services found that competition and rate review processes in states operating their own marketplace were associated with plan premium rates below Congressional Budget Office estimates.


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