Polarization, Participation, and Premiums: How Political Behavior Helps Explain Where the ACA Works, and Where It Doesn't.

Abstract

Political partisanship can influence whether individuals enroll in government programs. In particular, Republicans, ceteris paribus, are less likely to enroll in Affordable Care Act (ACA) individual marketplace insurance than Democrats. The logic of adverse selection suggests low uptake among Republicans would generally put upward pressure on marketplace premiums, especially in geographic areas with more Republican partisans. Using data from Healthcare.gov at the rating area level, this article examines the association between Republican vote share and growth in ACA marketplace premiums, being careful to account for potential confounding variables. Insurers have increased marketplace premiums at higher rates in areas with more Republican voters. In the preferred model specification, a 10-percentage-point difference in Republican vote share is associated with a 3.2-percentage-point increase in average premium growth for a standard plan. A variety of robustness and placebo checks suggest the relationship is driven by partisanship. Partisan polarization can threaten the successful implementation of policies that rely on high levels of citizen participation.