Existing market share has been a fairly good predictor of health plan participation in the federal exchange, although new entrants like CO-OPs may give some a run for their money, according to a Milliman report.
In an analysis of federal exchange data, Milliman actuaries found that more than 80 percent of insurers with 50 percent or more market share in 2012 are selling federal HIX plans -- while less than half of carriers with a market share of 25 percent or less are are participating.
At the same time, the combined 2012 market share of carriers selling individual plans is less than 50 percent in six states -- Iowa, Maine, Mississippi, South Dakota, Tennessee and Wyoming -- where "large swings in insurer market share may occur as consumers wanting to receive a premium subsidy may have to choose a new insurer," Milliman actuaries Paul Houchens, Jason Clarkson and Michael Sturm wrote in the report.
And carriers in seven states selling small business plans also had a combined small group market share of less than 50 percent in 2012, in Arizona, Florida, Georgia, Iowa, Maine, South Dakota and Wisconsin.
For consumers, the choice of health plans with varying benefit tiers and provider networks averages out to 48 plans available in the federal HIX's 36 individual markets, but only 24 in the 34 small business exchange markets (Mississippi and Utah are running their own small business health options programs).
For individual plans, the average number of choices runs from eight available in Alabama to 111 in Arizona, while for SHOP plans, the choices vary from just three in Missouri to 92 in Arizona.
"The slightly lower observed insurer participation in the SHOP exchange may lessen the appeal to small employers of purchasing coverage through the exchange," Houchens and colleagues wrote. "However, many employers may still be attracted to the federal exchanges due to the fact that the small employer tax credit can only be obtained when coverage is purchased through the exchange."
In some states, there may also be new options, such as provider-based health plans and consumer oriented and operated plans. In the individual markets, 22 percent of health plans are new entrants, mostly in Medicaid managed care plans (options geared especially towards consumers with fluctuating incomes), and in the small business markets, 14 percent new to the market, mostly CO-OPs, the Milliman report found.
Many of those new CO-OPs and provider-owned plans can be found in the Midwest, especially in the SHOP exchanges.
In Iowa, the large insurer Wellmark is sitting out the exchanges in 2013, while CoOpportunity Health, an ACA-supported CO-OP also selling in Nebraska, is selling a large variety of small business plans, and Gundersen Health System, which operates in Iowa, Minnesota and Wisconsin, is sponsoring a health plan with 140 different options in certain parts of the state.
Still, many of the new entrants don't offer coverage on a statewide basis. "This may suggest that many exchange insurers, both existing and new insurance market participants, are initially focused on competing in the exchanges at a regional level due to the inability to develop a broad, statewide provider network, while still offering a competitive premium rate," Houchens and colleagues wrote.