Group Health Insurance Versus ACA Marketplaces: Selection, Subsidies, and Welfare

Sebastian Fleitas, Caitlyn Fleming, Gautam Gowrisankaran and Anthony Lo Sasso

No 20350, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: The Affordable Care Act (ACA) changed incentives for individual and employer-sponsored insurance. Using unique small group market (SGM) data with detailed claims and enrollment information, we analyze the welfare gains across households in the SGM from alternative formulations of ACA health insurance exchanges (HIXs). Accounting for observable heterogeneity increases estimated demand elasticities. Shutting down the SGM would reduce equilibrium adverse selection in HIX-type markets, increasing welfare for households moved to HIXs by $842 annually. The majority of households would obtain higher equilibrium welfare from HIXs, stemming from having more choices. Adding the 2014 ACA penalties only modestly decreases adverse selection.

JEL-codes: H30 I13 L11 (search for similar items in EconPapers)
Date: 2025-06
References: Add references at CitEc
Citations:

Downloads: (external link)
https://cepr.org/publications/DP20350 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:20350

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP20350

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().