Insurer Participation on the ACA Marketplaces, 2014-2021

Since the Affordable Care Act marketplaces opened in 2014, the number of insurers participating on the exchanges has been in constant flux as companies have entered or exited the market, and expanded or reduced their footprint in states.

For the third straight year, several insurers are entering the market or expanding their service area in 2021. This year, we find that 30 insurers are entering the individual market across 20 states (Table 1) and an additional 61 insurers are expanding their service area within states they already operated. There will be an average of 5.0 insurers per state in 2021, up from a low of 3.5 in 2018 but still below the peak of 6.0 in 2015. The number of insurers per state ranges from one company operating in Delaware to thirteen operating in Wisconsin.

The map and chart below show how insurer participation has changed from 2014 through 2021 in every county in the U.S.

Figure 1

The number of consumers with multiple insurer options has steadily grown in recent years (Figure 2). In 2021, 78% of enrollees (living in 46% of counties) will have a choice of three or more insurers, up from 67% of enrollees in 2020 and 58% of enrollees in 2019.

More than 200 counties will have 5 or more insurers participating in 2021, including eight insurers offering plans in certain areas of Washington, Ohio and Florida. Only 10% of counties have only a single insurer offering in 2021, down from 52% of counties in 2018 (Figure 2).

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State Insurers (Parent Companies) Entering Marketplaces
Arizona UnitedHealth
Florida AvMed, Guidewell
Iowa Oscar
Idaho Cambia Health Solutions
Illinois Bright Health, Mercy Health, SSM Health
Indiana Anthem
Kansas BCBS of Kansas City
Maryland UnitedHealth
Minnesota Quartz, PreferredOne
Missouri BCBS of Kansas City
North Carolina Oscar, UnitedHealth
New Mexico Friday Health Plans
Nevada Friday Health Plans, Selecthealth
Oklahoma CommunityCare, Oscar, UnitedHealth
Tennessee UnitedHealth
Texas Friday Health Plans, Scott and White
Virginia UnitedHealth
Washington Community Health Plan of WA, UnitedHealth
Wisconsin Anthem
Wyoming Mountain Health
SOURCE: KFF analysis of data from Healthcare.gov and a review of state rate filings.

Although there are an average of 5.0 insurance companies participating per state in 2021, insurers typically do not participate statewide. Insurer participation varies greatly within states, and rural areas tend to have fewer insurers. On average, metro-area counties have 3.1 insurers participating in 2021 (up from 2.6 in 2020), compared to 2.5 insurers in non-metro counties (up from 2.0 in 2020). In 2020, 87% of enrollees lived in metro counties.

Going into 2021, 1,207 counties (38%) are gaining at least one insurer, while only 12 counties nationwide will lose an insurer (net of any entrances). The map below shows net insurer entrances and exits for 2021 by county.

Figure 3

As noted above, there remain several counties with just one exchange insurer, though the number is decreasing. In 2021, 10% of counties (accounting for 3% of enrollees) will have access to just one insurer on the marketplace (a considerable decrease from 25% of counties and 10% of enrollees in 2020).

Figure 4

Often, when there is only one insurer participating on the exchange, that company is a Blue Cross Blue Shield or Anthem plan (Figure 4). Before the ACA, state individual markets were often dominated by a single Blue Cross Blue Shield plan.

Insurer Participation in Previous Years

Insurer participation levels have steadily climbed back to levels seen in the early years of ACA implementation. In 2014, there were an average of 5.0 insurers participating in each state’s ACA marketplace, ranging from one company in New Hampshire and West Virginia to 16 companies in New York (see Table 2 in the appendix). 2015 saw a net increase in insurer participation and marked the highest levels of insurer participation on the Marketplaces to date, with an average of 6.0 insurers per state. In 2016, insurer participation dipped slightly to 5.6 companies per state due to due to a combination of some new insurer exits and the failure of a number of CO-OP plans. In 2017, insurance company losses led to a number of high profile exits from the market and the average number of companies per state decreased to 4.3.

Although insurance company financial performance improved during 2017, a number of insurers exited the market or reduced their service area going in to 2018 and insurer participation bottomed-out at 3.5 per state, likely driven in part by legislative and regulatory uncertainty surrounding ACA repeal and replace and cost-sharing subsidy payments. In 2018, eight states (Alaska, Delaware, Iowa, Mississippi, Nebraska, Oklahoma, South Carolina, and Wyoming) had just one participating insurer but, despite concerns earlier in the year, all counties across the country had at least one insurer in 2018. In 2018, insurers in this market were quite profitable and arguably over-priced.

Despite the zeroing out of the individual mandate penalty, insurance company margins continued to be high in 2019, and a number of insurers entered the market or expanded their service area. The average number of marketplace insurance companies per state in 2019 was 4.0, ranging from one company in five states (Alaska, Delaware, Mississippi, Nebraska, and Wyoming) to more than 10 companies in three states (California, New York and Wisconsin). In 2020, marketplace insurer participation rose to an average of 4.5 insurers per state, ranging from one company each in Delaware and Wyoming to more than ten companies in California, New York, and Wisconsin. Even during the coronavirus pandemic, the individual market remained stable and participating insurers continued to perform well financially. The new entrants and expansions since 2019, along with steady premiums and profits, serve as evidence that the zeroing out of the individual mandate penalty and expansion of short-term insurance plans did not disrupt the individual market as much as expected.

Discussion

Despite uncertainties surrounding the ongoing pandemic and its impact on individual market enrollment and insurer viability, insurer participation on the ACA marketplaces is increasing for the third straight year in 2021 and will equal average participation levels at the outset of the marketplaces in 2014. The share of marketplace enrollees with only one insurer option (3%) has continued to decrease and will be the lowest rate since 2016 (when 2% of enrollees had only one insurer option). As has been the case in the previous two years, there are a number companies entering the market or expanding their footprints within states in 2021, exceeding the number of insurers exiting or cutting down on their service area. Nonetheless, the market overall continues to have lower insurer participation than its peak in 2016.

Thus far, insurer financial performance data in 2020 suggests that insurers remained profitable before and during the pandemic. Decreases in health care utilization and claims costs have contributed to relatively the high gross margins among individual market insurers this year. Even though insurers must cover the cost of testing and many have voluntarily waived cost-sharing for COVID-19 treatment, insurers are on track yet again to owe substantial rebates to consumers based on low medical loss ratios in 2021 (based on their 2018-2020 experience). Marketplace premiums are falling 1-4% on average in 2021 despite questions about what the pandemic will look like next year and the potential that the Supreme Court will invalidate the Affordable Care Act in their ruling in California v. Texas. Combined with these moderate premium decreases, the steady increase in insurer participation on the marketplaces for 2021 highlights the continued stability and attractiveness of the individual market for insurers across the country.

State 2014 2015 2016 2017 2018 2019 2020 2021
Alabama 2 3 3 1 2 2 2 2
Alaska 2 2 2 1 1 1 2 2
Arizona 8 11 8 2 2 5 5 6
Arkansas 3 3 4 3 3 3 3 3
California 11 10 12 11 11 11 11 11
Colorado 10 10 8 7 7 7 8 8
Connecticut 3 4 4 2 2 2 2 2
Delaware 2 2 2 2 1 1 1 1
DC 3 3 2 2 2 2 2 2
Florida 8 10 7 5 4 5 7 9
Georgia 5 9 8 5 4 4 6 6
Hawaii 2 2 2 2 2 2 2 2
Idaho 4 5 5 5 4 4 4 5
Illinois 5 8 7 5 4 5 5 8
Indiana 4 8 7 4 2 2 2 3
Iowa 4 4 4 4 1 2 2 3
Kansas 3 3 3 3 3 3 5 6
Kentucky 3 5 7 3 2 2 2 2
Louisiana 4 5 4 3 2 2 3 3
Maine 2 3 3 3 2 3 3 3
Maryland 4 5 5 3 2 2 2 3
Massachusetts 10 10 10 9 7 8 8 8
Michigan 9 13 11 9 7 8 8 8
Minnesota 5 4 4 4 4 4 4 6
Mississippi 2 3 3 2 1 1 2 2
Missouri 3 6 6 4 3 4 7 8
Montana 3 4 3 3 3 3 3 3
Nebraska 4 4 4 2 1 1 2 2
Nevada 4 5 3 3 2 2 3 5
New Hampshire 1 5 5 4 3 3 3 3
New Jersey 3 5 5 2 3 3 3 3
New Mexico 4 5 4 4 4 4 4 5
New York 16 16 15 14 12 12 12 12
North Carolina 2 3 3 2 2 3 4 6
North Dakota 3 3 3 3 2 3 3 3
Ohio 12 15 14 10 8 9 9 9
Oklahoma 4 4 2 1 1 2 3 6
Oregon 11 10 10 6 5 5 5 5
Pennsylvania 7 8 7 5 5 6 7 7
Rhode Island 2 3 3 2 2 2 2 2
South Carolina 3 4 3 1 1 2 4 4
South Dakota 3 3 2 2 2 2 2 2
Tennessee 4 5 4 3 3 5 5 6
Texas 11 14 16 10 8 8 8 10
Utah 6 6 4 3 2 3 5 5
Vermont 2 2 2 2 2 2 2 2
Virginia 5 6 7 8 6 7 8 8
Washington 7 9 8 6 5 5 7 9
West Virginia 1 1 2 2 2 2 2 2
Wisconsin 13 15 16 15 11 12 12 13
Wyoming 2 2 1 1 1 1 1 2
US Average 5.0 6.0 5.6 4.3 3.5 4.0 4.5 5.0
NOTE: Insurers are grouped by parent company or group affiliation.
SOURCES: KFF analysis of data from Healthcare.gov and a review of state rate filings.

Methods

Data were gathered from healthcare.gov, state-based exchange enrollment websites, and insurer rate filings to state regulators. Companies and related subsidiaries were grouped by their parent or group affiliation using Mark Farrah Associates Health Coverage Portal TM. Enrollment in states using Healthcare.gov is from HHS (with some adjustments made for counties without reported enrollment). In states running their own exchanges, we gathered county-level data enrollment data where possible and if unavailable estimated county level enrollment based on the state’s enrollment total. 2021 enrollment is estimated using 2020 plan selections. For most states running their own exchange, insurer participation is measured at the rating area level.