If a health insurance marketplace launches in the woods with exactly one insurance carrier, does it count as a marketplace at all?
This is not an odd health policy riddle (although that sounds fun as well!). It is actually the situation in New Hampshire, where its increasingly looking like just one health insurer, Anthem BlueCross BlueShield, will compete on the exchange – if that counts as competing at all.
An official from that the plan confirmed to the Associated Press that it would sell in the New Hampshire market. A spokesperson did not return a request for comment. The state insurance department, meanwhile, says its quite possible that the exchange could end up with one competitor.
"We expect the exchange to look a lot like our individual market, where there's one carrier with about 90 percent of the business," says Alex Feldvebel, deputy commissioner at the New Hampshire Department of Insurance. "It's not very surprising that in New Hampshire, there might be only one carrier offering coverage through the exchange."
Still, New Hampshire is not a complete anomaly. Neighboring Vermont and nearby Rhode Island have each had two health insurance carriers apply to sell on their exchanges.
"The New England markets are very small and have tended to be pretty highly regulated," says Caroline Pearson, vice president for health reform at Avalere Health. "The national carriers have generally not been players in New England because of their guaranteed issue and community rating. So you have some regional plans that are very entrenched."
One big factor that Pearson pointed out is how concentrated New England's insurance markets tend to be. Both New Hampshire and Vermont have health plans that control more than 65 percent of their market.
California and Colorado, meanwhile, are among about a dozen states where no health insurance plan runs more than 45 percent of the individual market.
"While substantial variation exists," analysts at the Kaiser Family Foundation concluded in 2011, "the current insurance markets in many states are highly concentrated with only modest competition."
The whole idea of the exchanges was to create an even playing field for health insurance plans, where competition could drive down premiums. It is still possible for that to happen in a state like New Hampshire. The Affordable Care Act requires the federal government to contract with two private health insurers to create "multi-state plans" that will, by 2017, compete in all 50 states.
They will not, however, be everywhere in 2014: The health-care law lets the multi-state plans phase in their coverage over three years. In year one, or 2014, a multi-state plan only needs to enter 30 state exchanges.
"I would suspect that national plans wouldn't pick New Hampshire as one of their first markets," Pearson says. "It is possible though that CMS [the Center for Medicare and Medicaid Services] might be able to persuade the national plan to play there, even if it wasn't their first choice."
New Hampshire is still in wait-and-see mode when it comes to possible competition on its exchange. The deadline for health plans to file a bid for the exchange is at the end of this week, so it is possible that a new carrier could throw its hat in the ring. Officials there expect to learn in coming months whether the multi-state plan will come to their state.
"As we understand it, that will depend on what state the plan expresses interest in," says Jennifer Patterson, health legal counsel at the New Hampshire Insurance Department. "We don't know yet if we're going to have one."
Health law supporters in New Hampshire expressed disappointment with the lack of competition in the marketplace. That includes Scott Baetz, a small-business owner who says he has voted more Democratic since the Affordable Care Act passed.
"Conceptually, I think that by providing health care to the citizens of the United States, we make ourselves a more employable workforce and a healthier community," says Baetz, who provides coverage to the five employees at his company. "If we're all focused on that, it should really reduce our long-term costs."
Baetz now serves on the advisory council to the New Hampshire Health Exchange and describes himself as "disappointed" with the news that Granite State residents may only have one option on the new marketplace.
"There has been a lot of optimism that some of the benefits of the health-care law would mean broader choice and reduced costs," Baetz says. "Now, it seems like those options may not be available to us."
KLIFF NOTES: Top health policy reads from around the Web.
Nancy-Ann DeParle is fundraising for Enroll America. "DeParle is asking top executives at several health insurance companies to donate $1 million or more to Enroll America, a nonprofit organization promoting Obamacare enrollment, several sources familiar with her role said. DeParle’s free to raise money for any cause she chooses, including a law for which she advocated. But her solicitations underscore the problems the administration is having getting the resources it needs from a recalcitrant Congress to implement the law." Jennifer Haberkorn and Brett Norman in Politico.
A new study finds Medicare's spending differences are largely due to health status. "The idea that uneven Medicare health care spending around the country is due to wasteful practices and overtreatment — a concept that influenced the federal health law — takes another hit in a study published Tuesday. The paper concludes that health differences around the country explain between 75 percent and 85 percent of the cost variations." Jordan Rau in Kaiser Health News.
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