Practice Economics

ACA exchanges most expensive in state-based systems


States that opted to run their own Affordable Care Act–mandated health insurance marketplace spent more than three times as much per uninsured person to assist consumers than did states with federally run exchanges.

An analysis by the Leonard Davis Institute of Economics and the Robert Wood Johnson Foundation showed that the 17 state-based marketplaces (SBMs) spent an average of $17.15/eligible uninsured person, compared with $5.42/eligible uninsured person in the 29 federally facilitated marketplaces (FFMs). The five states that use a state-consumer partnership to run their marketplaces spent $31.53/uninsured person.

"SBMs accounted for 50% of total consumer assistance funds, although they have just 31% of all uninsured. In contrast, 63% of the uninsured live in FFM states, which accounted for 33% of the funding. The five partnership states in charge of consumer assistance functions were home to just 6% of the uninsured, but garnered 17% of the funding," the report noted.

The District of Columbia, grouped among the SBM states, spent $163.93/uninsured person, which was higher than any state. The highest-spending state was Hawaii (SBM) at $87.86, and the lowest-spending state was Georgia (FFM), which spent $4.24 per uninsured person, according to the report.

The joint study used data from the Centers for Medicare & Medicaid Services, the Kaiser Family Foundation, and the Health Resources and Services Administration. The Leonard Davis Institute is a cooperative venture between the University of Pennsylvania and the Children’s Hospital of Philadelphia.

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