BCBS plans account for nearly half of ACA enrollment, but face rising competition from Medicaid insurers

Dive Brief:

  • Health plans issued by Blue Cross Blue Shield companies accounted for nearly half of Affordable Care Act marketplace enrollment in 2018, but health plans that traditionally focus on Medicaid are a growing source of competition, according to a new report from the Urban Institute and Robert Wood Johnson Foundation.
  • BCBS insurers hold all or almost all enrollment in the marketplaces of 11 states: Alaska, Alabama, Delaware, Illinois, Louisiana, North Carolina, North Dakota, New Hampshire, Oklahoma, South Carolina and Wyoming, researchers found through an analysis of CMS data from 39 states using the federal Healthcare.gov platform.
  • In eight states — Arizona, Georgia, Indiana, Kentucky, Mississippi, New Mexico, Ohio and Texas — Medicaid insurers make up the majority of enrollment. Medicaid insurers’ market share on the exchanges overall ballooned from 15% of the marketplace in 2016 to 27% by 2018.

Dive Insight:

Researchers say the data is an accurate snapshot of enrollment prior to the pandemic, as widespread unemployment and the loss of employer-sponsored coverage are expected to significantly reshape payer mix across the United States this year and beyond, boosting marketplace and Medicaid enrollment.

BCBS-affiliated payers, such as Anthem, accounted for almost half of marketplace enrollment nationally in 2018, the report found​. Medicaid managed care payers, such as Centene and Molina, typically offer lower premiums than BCBS plans, yet their enrollment was just a little more than half of BCBS plans.

However, in nine states — Arkansas, Florida, Hawaii, Kansas, Michigan, New Jersey, Pennsylvania, Tennessee and West Virginia — BCBS plans have the majority of enrollment, but face increasing competition from other insurers, typically Medicaid insurers.

Growth in Medicaid managed care plans basically replaced lost enrollment in other insurer groups since 2016, notably among national and regional insurers, the report found. 

Rebecca Pifer/Healthcare Dive, Urban Institute data

In 2018, national and regional plans like UnitedHealthcare and CVS Health-owned Aetna accounted for less than half of the enrollment that they did in 2016, largely reducing competition in certain markets, though they still hold the most marketplace enrollment in six states: Iowa, Missouri, Nebraska, Nevada, South Dakota and Utah.

Other findings include that provider sponsored insurers consistently had 8% to 11% of enrollment, while co-ops had about 2%.

While provider-sponsored insurers like Kaiser Permanente are minor players in many states, they do hold substantial market share in three: Oregon, Virginia and Wisconsin.

The report also found the number of insurers participating in the marketplace in 2019 and 2020 increased, and there are now reports of national insurers re-entering marketplaces in 2021. Researchers noted it would be “interesting to observe” whether these insurers regain previous levels of enrollment, like 2016’s figures.

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