Stabilizing Premiums Under the Affordable Care Act

State Efforts to Reduce Adverse Selection

Several states are going beyond Affordable Care Act (ACA) provisions to protect consumers from health insurance premium increases caused by "rate shock." This report analyzes 11 states and finds that officials are taking different approaches to protecting consumers.

Key Findings

  • Maryland and Oregon, established their own reinusurance programs with state funds to better control premium costs.

  • Colorado, Minnesota, and Alabama have begun transitioning people with pre-existing conditions out of high-risk pools into plans with younger, healthier people.

  • Maryland, New York, and Oregon are protecting against insurers undercutting the exchanges by “locking them out” in subsequent years if they don’t participate in year one—as well as limiting the sale of catastrophic plans.

  • Maryland, New York, Oregon, and Colorado also standardized broker compensation inside and outside the exchange to prevent customers from being steered away from one market toward another.

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