More U.S. counties to see Obamacare marketplace monopoly: analysis

August 28, 2016 10:53 PM EDT

U.S. President Barack Obama delivers remarks about health insurance marketplace enrollments and the Affordable Care Act, commonly known as Obamacare, in Milwaukee, Wisconsin March 3, 2016. REUTERS/Jonathan Ernst

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By Trevor Hunnicutt

NEW YORK (Reuters) - Nearly a third of U.S. counties likely will be served by only one insurer that participates in an Affordable Care Act (ACA) marketplace in 2017, according to an analysis published on Sunday by the Kaiser Family Foundation.

The 31 percent of U.S. counties that will have just a single option of insurers within the ACA's exchanges would represent an increase from 7 percent this year, the nonpartisan group found. Despite sharing a namesake, the Kaiser Family Foundation is not associated with healthcare provider Kaiser Permanente.

UnitedHealth Group Inc (NYSE: UNH) and Aetna Inc (NYSE: AET) have decided to largely exit government-run online marketplaces in 2017 that sell subsidized plans created under President Barack Obama's national healthcare reform law, citing low enrollment and high service costs.

The bulk of the decrease in counties with a choice of insurers is due to UnitedHealth's pullback, which was announced in April.

The data underscores the degree to which industry retrenchment is curtailing individual's options within the marketplaces. Insurer departures may lead to higher costs within that market, analysts have said.

One county - Pinal County in Arizona - risks having no insurer options at all within the marketplace, the analysis found. The study's authors said another plan offered elsewhere in the state could expand to serve the county.

The foundation said it could take more months and more data for the full impact of the changes for 2017 to become clear.

"A number of steps remain before the full picture of this year's Marketplace competition is known but the ACA has greatly expanded the insurance options available to consumers in the individual marketplace," said Marjorie Connolly, a spokeswoman for the U.S. Department of Health and Human Services, in a statement.

(Reporting by Trevor Hunnicutt; Editing by Paul Tait and Bill Trott)

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