Peter Fricke details for Daily Caller readers one consequence of the Affordable Care Act for small insurance providers.

A combination of government regulations and competitive pressures are causing many insurance providers to abandon the Obamacare exchanges for individuals and small businesses, according to a report released Monday by the Government Accountability Office.

In 2012, a small number of issuers of health coverage in the Obamacare exchanges accounted for a large majority of enrollments. There were an average of 42 issuers on the individual exchanges, for instance, but “only 4 had at least a 5 percent share of the market and they accounted for a combined 87 percent of that market.”

For the most part, “issuers with less than 5 percent of their 2012 market did not participate in the 2014 exchanges,” the report says, while most issuers with a share greater than 5 percent elected to continue participating in 2014.

To an extent, this likely reflects competition among providers driving the least successful companies from the market, but the GAO also identified a number of state and federal regulations that may have contributed to the decisions of some smaller issuers to leave the exchanges.

According to the report, “about one-third of states chose to operate their exchanges, and these states had the ability to impose limitations on exchange participation and plan offerings.”

Seven states, for instance, required “issuers participating in exchanges to offer a minimum number of health plans,” which could place a burden on smaller companies. There is also a federal requirement that an issuer must offer “a minimum of one silver and one gold plan in any area in which it participates in an exchange.”

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