While many are already suffering under Obamacare from increased premiums and their insurance plans being dropped, rural areas in particularly are hurting. President Obama promised that his health-care law would increase competition by bringing more insurance providers to the marketplace, and, while this is true in some areas, most counties covered by the federal exchanges are serviced by only one or two insurance providers.
According to a New York Times report, the federal insurance exchanges service roughly 2,500 counties; 58 percent of those counties only have one or two insurance providers offering coverage, and of those that only have one or two providers, most are rural. Though the Obama administration optimistically claims that 95 percent of Americans have access to at least two insurers, many experts, according to the Times article, say that two carriers might not create enough competition to actually lower prices. As a result, many in the rural regions with few options are facing the highest premiums of any place with federal insurance marketplaces.
The Times says that many insurance companies have not attempted to enter low-population areas because, among other reasons, the potential customer pool is low, many times one hospital dominates the area, providing little leverage for insurers to negotiate reimbursement rates, and because it is difficult to challenge dominant insurers in a region.
Most counties with only one insurance provider are in the South, predominantly in Mississippi and Alabama.
Other plans to increase competition have faced setbacks, including nonprofit co-ops, which were to provide an alternative to major health-care insurers. The co-ops are experiencing budget shortfalls and many have not even gotten off the ground because of limitations in federal funding.