How ACA Insurer Participation May Perpetuate Care Disparities

Insurer participation in the Affordable Care Act marketplace may contribute to a lack of health equity, at least in the early days of the Affordable Care Act individual marketplace, a study published in JAMA Network Open found.

“Redlining has referred to the practice of systematically denying credit access and insurance for borrowers in neighborhoods that were economically disadvantaged and that were inhabited primarily by Black Americans,” the study explained.

“An important link between historical redlining and health outcomes is likely related to health insurers’ strategic considerations about what markets to participate within, how to design coverage plans, and what physicians to include within their networks based on neighborhood characteristics.”

The researchers used data from the Health Insurance Exchange Compare Public Use Files from the 2014 HIX Compare Individual Market database as well as the Opportunity Insight Project and the US Centers for Disease Control and Prevention’s PLACES database.

The data comes from the inception year of the Affordable Care Act individual marketplaces, the study noted, and as such the results may warrant further investigation with more recent data.

Larger populations of non-Hispanic Black individuals in a county were associated with lower numbers of participating insurers in the Affordable Care Act marketplace for those counties, the researchers found. Even when adjusting for potential barriers to insurer participation, counties with more non-Hispanic Black residents were more likely to have lower insurer participation.

A single standard deviation shift upward in the size of the non-Hispanic Black population was associated with slightly more than a 14 percent drop in the number of insurers participating in that county’s marketplace. This was still the case even when taking into account county care coordination, median household income, public health, and insurers’ risk selection.

However, a single standard deviation shift upward in the size of the non-Hispanic Black population had a 4.5 percent decline in association with insurer participation, the researchers added.

Provider network size also reacted to the size of the non-Hispanic Black resident population in a county. A population that rose by one standard deviation corresponded with a decrease in the breadth of the provider network. Provider network breadth could decline by anywhere from 15.8 to 24.7 percent—or six to 13.5 percent when accounting for state-based factors. 

The exact decrease varied based on the provider's specialty. Specifically, family medicine specialists declined the most, dropping 24.7 percent with each increase in the population size standard deviation. Internists had the second-highest decrease (21 percent), followed by pediatricians (17.8 percent) and general practice specialties (15.8 percent).

“These observations suggest that the actions by insurers within the individual ACA marketplaces may not only be perpetuating historical structural inequities that have resulted in well-documented health disparities across race and ethnicity, but that insurers may in fact be making strategic decisions as a direct function of a region’s racial makeup,” the researchers concluded. 

“Such market dynamics are concerning as they risk further growing existing racial inequities in health care access and in health outcomes, and they deserve further examination.”

The researchers noted that the study could not assess causation, certain variables may have been omitted, and the results may not apply to states not included in the sample. Given that the data is from 2014, the study does not reflect the impact of the coronavirus pandemic on the individual health insurance marketplace, as well as other chronological factors.

In 2021, the Department of Health and Human Services (HHS) found that diversity in Affordable Care Act marketplace enrollment had improved. And more payers have been joining the marketplace.