Many insurers only dipped a toe聽into the Affordable Care Act鈥檚 online marketplaces for their first year.
Cigna, one of the country鈥檚 largest insurers, offered 2014 plans to individuals in fewer than half a dozen states. Humana is only in a little more than a dozen states. The biggest health insurer, UnitedHealthcare, didn鈥檛 offer any policies through the federally run online portal and only a few elsewhere.
The result: substantially higher premiums than otherwise would have been the case, according to .
Economists Leemore Dafny, Jonathan Gruber and Christopher Ody ran alternate-reality experiments in markets in the 34 states served by healthcare.gov, the federal exchange.
What if UnitedHealthcare had competed everywhere that it already sold individual policies? Premiums in those markets for the second lowest-cost silver plan would have averaged 5.4 percent less, they calculated.
Silver plans come after platinum and gold in the exchanges鈥� 鈥渕etal鈥� rankings of coverage. The second-lowest priced silver plan in each market determines the level of tax-credits for medium- and lower-income consumers.
What if every insurer selling individual plans in at least some portion of a state had decided to offer 2014 exchange policies throughout that state? Average premiums on healthcare.gov for the second lowest-cost silver plan would have been 11.1 percent lower, the researchers found.
That level of competition would have saved federal taxpayers $1.7 billion in subsidies, they reported 鈥� not to mention substantial amounts for consumers.
Competition varied sharply according to state and locality. Consumers in many markets saw 听辞ffering coverage while others saw eight or more. In general, the more competitors, the lower the premiums.
Carriers that stood aside or tread聽lightly in 2014 have 聽next year. That could increase competition and dampen premium increases.
UnitedHealthcare has 鈥渁 bias to increase that participation in 2015,鈥� , the insurer鈥檚 chief executive, .
鈥淭hat鈥檚 welcome news and I鈥檇 like to see more of it,鈥� Dafny said in an interview.