RAND-Establishing State Health Insurance Exchanges:Implications for Health Insurance Enrollment, Spending, and Small Businesses

The RAND report analyzes the effects of the Patient Protection and Affordable Care Act (ACA) on employers and enrollees in employer-sponsored health insurance, with a focus on small businesses and businesses offering coverage through health insurance exchanges. Outcomes assessed include:

• the proportion of nonelderly Americans with insurance coverage,
• the number of employers offering health insurance,
• premium prices,
• total employer spending, and
• total government spending relative to what would have been observed without the policy change.

The report predicts that the ACA will increase insurance offer rates among small businesses from 53 to 77 percent for firms with ten or fewer workers, from 71 to 90 percent for firms with 11 to 25 workers, and from 90 percent to nearly 100 percent for firms with 26 to 100 workers. Simultaneously, the uninsurance rate in the United States would fall from 19 to 6 percent of the nonelderly population. The report also predicts that approximately 60 percent of businesses will offer coverage through the health insurance exchanges after the reform. Under baseline assumptions, a total of 68 million people will enroll in the exchanges, of whom 35 million will receive exchange-based coverage from an employer.

Read the report