One of the biggest problems with Obamacare is only getting worse

The problem with Obamacare

It's going to be a lot easier for people to pick an Obamacare plan in 2017, if only because there will be less to choose from.

One of the biggest drivers that causes increased costs of healthcare is the lack of competition in some markets. This problem is acutely present for the Affordable Care Act's public insurance exchanges, according to a new study by Avalere Health.

According to the healthcare consulting firm, the high profile exits of large insurers such as Aetna, UnitedHealthcare, and Humana have eliminated a significant amount of competition within the exchange market.

2016 issues: Health, Obamacare opinions, Medicare, abortion

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2016 issues: Health, Obamacare opinions, Medicare, Abortion
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2016 issues: Health, Obamacare opinions, Medicare, Abortion
MANHATTAN, NEW YORK CITY, UNITED STATES - 2015/08/22: Assembly of some 150 anti-abortion protesters behind barricade in front of Planned Parenthood. A coalition of anti-abortion protesters protested on Mott Street in Manhattan in front of Planned Parenthood. (Photo by Andy Katz/Pacific Press/LightRocket via Getty Images)
MANHATTAN, NEW YORK CITY, UNITED STATES - 2015/08/22: Protester with Baby Doe sign in front of Planned Parenthood. A coalition of anti-abortion protesters protested on Mott Street in Manhattan in front of Planned Parenthood. (Photo by Andy Katz/Pacific Press/LightRocket via Getty Images)
WASHINGTON, DC - JULY 28: Republican presidential candidate Dr. Ben Carson speaks at a anti-abortion rally opposing federal funding for Planned Parenthood in front of the U.S. Capitol July 28, 2015 in Washington, DC. Planned Parenthood faces mounting criticism amid the release of videos by a pro-life group and demands to vote in the Senate to stop funding. (Photo by Olivier Douliery/Getty Images)
WASHINGTON, DC - JULY 28: Republican presidential candidate, U.S. Sen. Ted Cruz (R-TX) speaks during a Anti-abortion rally opposing federal funding for Planned Parenthood in front of the U.S. Capitol July 28, 2015 in Washington, DC. Planned Parenthood faces mounting criticism amid the release of videos by a pro-life group and demands to vote in the Senate to stop funding. (Photo by Olivier Douliery/Getty Images)
UNITED STATES - JANUARY 22: Pro-choice protesters chant in front of the Supreme Court on Thursday, Jan. 22, 2015, the anniversary of the Roe v Wade abortion decision. (Photo By Bill Clark/CQ Roll Call)
UNITED STATES - FEBRUARY 5: Sen. Marco Rubio, R-Fla., testifies during the House Oversight and Government Reform Committee hearing on 'ObamaCare: Why the Need for an Insurance Company Bailout?' on Wednesday, Feb. 5, 2014. (Photo By Bill Clark/CQ Roll Call)
UNITED STATES - JUNE 25: Affordable Care Act supporters hold up signs outside the Supreme Court as they wait for the court's decision on Obamacare on Thursday, June 25, 2015. (Photo By Bill Clark/CQ Roll Call)
UNITED STATES - JUNE 25 - Supporters of the Affordable Care Act celebrate as the opinion for health care is reported outside of the Supreme Court in Washington,Thursday June 25, 2015. The Supreme Court on Thursday upheld the nationwide tax subsidies under President Barack Obama's health care overhaul, in a ruling that preserves health insurance for millions of Americans. (Photo By Al Drago/CQ Roll Call)
RICHMOND, CA - MARCH 31: Posters about Obamacare are posted on a window during a healthcare enrollment fair at the Bay Area Rescue Mission on March 31, 2014 in Richmond, California. SEIU-United Healthcare Workers West (SEIU-UHW) held the fair to help people sign up for free and low-cost health coverage through Medi-Cal or Covered California on the final day before the sign-up deadline. (Photo by Justin Sullivan/Getty Images)
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"A new analysis from Avalere finds that nearly 36 percent of exchange market rating regions may have only one participating insurance carrier offering plans for the 2017 plan year and there may be some sub-region counties where no plans are available," said a post on the study from Avalere President Dan Mendelson.

"Nearly 55 percent of exchange market rating regions may have two or fewer carriers."

Screen Shot 2016 08 24 at 7.40.06 AMChip Somodevilla/Getty Images

Avalere went through each of the coverage regions (the size of which can vary by state) and analyzed the current offerings by health insurers in 2016 and the so-far announced offerings for 2017.

The firm found that there are seven states — Alaska, Alabama, Kansas, North Carolina, Oklahoma, South Carolina, and Wyoming — in which every single coverage region only has one participating insurer. When this occurs, it essentially gives the insurer a monopoly and forces patients in that region to accept the premium that company offers.

Competition in the health insurance market has been a focus of government regulators for some time. One of the main reasons cited by the Department of Justice for blocking the mergers of Anthem and Cigna as well as Aetna and Humana was due to concerns over decreased competition.

This analysis only takes into account the announced moves from the three companies that plan to roll back their offerings, so there is a chance some insurers may step in to the underserved markets.

As it stands now, however, it appears one of the largest drivers of high healthcare costs for Obamacare is only getting worse.

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