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Obamacare nudges insurance competition

– A snapshot of Affordable Care Act enrollment in seven states suggests the law hasn’t significantly increased competition in health insurance markets, the Kaiser Family Foundation reported.

In California, for example, four big insurers have largely carved up the state’s market.

The divide is more equitable than before the Patient Protection and Affordable Care Act, as California’s insurance market is now “moderately concentrated” instead of “highly concentrated,” according to a measure of market share called the Herfindahl-Hirschman Index, said researchers at Kaiser, a Menlo nonprofit foundation in Menlo Park, Calif., that focuses on health care.

“There are some examples of smaller or newer plans being able to get a sizable piece of the market in the exchanges, but by and large, a lot of the players in the exchanges that are the biggest were the biggest before as well,” said Cynthia Cox, a senior analyst at Kaiser.

About 5 million Americans have signed up for private health plans using the law’s insurance exchanges, according to the U.S. government.

The exchanges were intended to ease access and improve transparency for people who shop for insurance on their own, about 5 percent of the U.S. population. Democrats who wrote the law also hoped to break the dominance of some companies that existed in many states.

In California, WellPoint’s Anthem brand signed up about 30 percent of the 869,000 people who used the state’s health exchange, Covered California, by March 1.

Anthem had 47 percent of the state’s market before Oct. 1, when plans started to be sold on the new health exchanges.

WellPoint also lost ground in New York and Nevada, where it fell from 28 percent and 34 percent of the market, respectively, to 18 percent and 12 percent.

In Connecticut, WellPoint’s plans now hold 60 percent of the market, up from 45 percent before major provisions of the law known as Obamacare took effect.

Before Obamacare, one insurance company held at least half of the individual market in 30 states, according to the Kaiser report.

That remains true in some states.

In Minnesota, for example, PreferredOne has taken about 59 percent of customers on the state’s exchange, MNsure.

Before the health law, the state’s Blue Cross Blue Shield plan had 59 percent of the market, while PreferredOne had 3 percent. Blue Cross Blue Shield now has 24 percent share.

The Kaiser report said that PreferredOne offered plans with “some of the lowest exchange premiums in the country” for plans with very narrow networks of hospitals and doctors.