An Updated Assessment of a Public Option’s Impact on Market Stability and Consumer Choice
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June 27, 2023
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Three years since the onset of the unprecedented health care crisis, the United States has in many ways returned to its pre-pandemic state. Yet, to this day, the lasting effects are still rippling throughout the health care system; not only do hospitals continue to struggle with managing debilitating staffing shortages, but the nationwide inflation spike is raising the cost of medical services.1 Now more than ever, the nation’s health care system cannot afford to have unnecessary added burdens exacerbate and deepen the challenges faced by the industry. As policymakers begin looking beyond pandemic response, the national conversation is likely to shift back to pre-pandemic health care policy reforms. As a result, a national public option could once again find itself on the federal policy agenda.
In a 2019 issue brief, “Assessing the Impact of a Public Option on Market Stability and Consumer Choice,”2 economists at FTI Consulting found that introducing a national public option could threaten the long-term viability of existing Affordable Care Act (ACA) plans and decimate private insurers’ ability to fairly compete and exist on the individual marketplace, due to government rate setting of public option premiums below the market value of comparable private insurance plans. In turn, enrollees could lose access to the numerous health plan options available to them on the marketplace and no longer be able to enroll in plans that are best suited to meet their unique care needs. In the following report, we have refreshed our 2019 analysis and reexamined the impact that a public option would have on market stability and consumer choice in ACA marketplaces in the wake of COVID-19. Our analysis reaffirms our previous findings surrounding market access and consumer choice.
Download the report to learn our key findings, analysis and concluding recommendation.
Footnotes:
1: “2022 State of Healthcare Performance Improvement: Mounting Pressures Pose New Challenges.” Kaufman Hall (October 2022). https://www.kaufmanhall.com/sites/default/files/2022-10/2022-State-Healthcare-Performance-Improvement.pdf.
2: Manning, Susan H. and Jeremy Nighohossian. “Assessing the Impact of a Public Option on Market Stability and Consumer Choice.” FTI Consulting, Inc. (November 19, 2019). https://www.fticonsulting.com/insights/reports/impact-public-option-market-stability-consumer-choice.
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June 27, 2023
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