The Affordable Care Act (ACA) needs the state-based exchanges, or “marketplaces,” to function. These exchanges were intended to replace the individual market for health insurance policies. But in recent weeks, insurance companies have released a deluge of bad omens, including financial losses and market exits, which signal that the exchanges are in bad shape. As a result, Americans can expect a reduction in consumer choice and increase in prices in the years ahead.

The demise of the exchanges should concern us all, as consumers and taxpayers. Some will suggest that government bailouts or takeovers of the insurance industry are necessary, but the right solution is just the opposite: We should offer more choices in individual insurance policies, not fewer, and rely on market competition to put downward pressure on price.