With multiple large insurers leaving the Affordable Care Act (ACA) marketplace, some are questioning the possibility of a market failure. In many places in 2017, the ACA marketplace will offer fewer consumers extensive options or rich benefits. In an article for Vox, FaegreBD Consulting Senior Director Mike Adelberg explained the evolution of the ACA marketplace. He discussed how the individual market operated before the ACA and how “the products were expensive and there was no subsidy.” This previous format was designed for the “white-collar employer market.”
But, going forward, he suggests that because "the exchange population — 85 percent of which qualifies for financial assistance — looks a lot like the Medicaid population. And with it, we’re seeing the start of the ‘Medicaid-ization’ of exchange plans: narrow networks with no frills."