Health care premiums on individual Affordable Care Act marketplace plans tend to be higher in rural areas, according to a new study by the Urban Institute with support from the Robert Wood Johnson Foundation.
The disparity has grown over the past several years; benchmark premiums in 2016 were 9 percent higher in rural areas ($26 more per month) and 10 percent higher in 2017 ($39 more per month). Some of the greatest rural-urban cost disparities were in Nevada, Colorado and Illinois.
"Lack of provider competition largely, if not predominantly, drove this disparity, the analysis says. Rural areas generally have fewer providers than urban areas to begin with, and the unyielding trend of consolidation is creating an even tighter market," Rose Meltzer reports for Fierce Healthcare. "As The Atlantic reported earlier this year, rural hospitals increasingly face a difficult choice: Be acquired or leave the community with no hospitals at all. In rural areas where the local hospital is the predominant employer, as is often the case, closure can mean economic ruin. And hundreds of rural hospitals are at risk of being shuttered, according to the National Rural Health Association" along with the dozens that have already closed in recent years.
The disparity has grown over the past several years; benchmark premiums in 2016 were 9 percent higher in rural areas ($26 more per month) and 10 percent higher in 2017 ($39 more per month). Some of the greatest rural-urban cost disparities were in Nevada, Colorado and Illinois.
"Lack of provider competition largely, if not predominantly, drove this disparity, the analysis says. Rural areas generally have fewer providers than urban areas to begin with, and the unyielding trend of consolidation is creating an even tighter market," Rose Meltzer reports for Fierce Healthcare. "As The Atlantic reported earlier this year, rural hospitals increasingly face a difficult choice: Be acquired or leave the community with no hospitals at all. In rural areas where the local hospital is the predominant employer, as is often the case, closure can mean economic ruin. And hundreds of rural hospitals are at risk of being shuttered, according to the National Rural Health Association" along with the dozens that have already closed in recent years.
The study's lead author, Erik Wengle, says reinsurance programs can help stabilize rural insurance polls in the long run, and says a permanent federal reinsurance program could help states but would likely have to be established through legislation.
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