High concentration of health care insurance markets continues Benefits PRO

The concentration of insurance markets is the subject of a detailed new report from the American Medical Association (AMA), which finds that limited competition among insurers can harm consumers and providers.

The AMA report targeted insurers with the largest shares of the commercial health insurance market, Medicare Advantage plans, and public health exchanges that are part of the Affordable Care Act (ACA).

High market concentration leads to low competition among health insurers, which can harm patients by raising insurance premiums above competitive levels, said AMA President Jess M. Ehrenfeld, MD, MPH, segment of markets that are highly The concentration may be much higher than the current reflection. Federal guidelines. The AMA supports draft federal guidelines that lower the regulatory threshold for markets to be considered more concentrated. To reverse the trend toward health insurance integration, the AMA strongly advocates [federal] The proposal as a suitable prescription to limit the integration of assessment and potential loss insurance.

Top insurers by market size and type.

Nationally, the AMA findings said, the 10 largest commercial health insurers by market share are: 1. United Health Group (14%), 2. HealthHealth (12%), 3. CVS (Aetna ) (11%), 4. Cigna (10%), 5. Kaiser Permanente (7%), 6. Healthcare Services Corporation (6%), 7. Blue Cross Blue Shield of Michigan (2%), 8. Florida Blue Cross Blue Shield (2%), 9. California Blue Shield (2%), and 10. High Mark (2%).

It further found that UnitedHealth Group was the largest commercial health insurer nationally by market share in the Medicare Advantage market, in 42% of MSAs, followed by Humana with market share leadership in 22% of MSAs, and CVS (Aetna) with Market. Share leads in 7% of MSAs.

For ACA markets, 90% of MSA-level markets were highly concentrated in 2022, down from 95% in 2014. In 67% of MSAs, one health insurer had at least 50% market share.

In areas of high population, the concentration is high

The report took a closer look at 381 metropolitan statistical areas (MSAs) across the country. It found that 73% of the MSA business market was highly concentrated, based on national standards. In 48% of markets, the share of single insurers was at least 50%.

The numbers also show that market concentration is not a new phenomenon. Between 2014 and 2022, the share of highly concentrated commercial markets increased from 71% to 73% across the country. Although a two-point increase in eight years is not dramatic, the major point in the analysis is that market concentration is high and seems to be firmly in place, with the numbers continuing.

The analysis said that consistently high levels of market concentration are associated with consolidation of insurers through mergers and acquisitions. Mergers and acquisitions involving health insurers should raise serious antitrust concerns, the report adds. Conceptually, mergers and acquisitions can have beneficial and/or detrimental effects on consumers. However, only the last one has been seen. Consolidation appears to have the ability to raise and maintain premiums above competitive levels rather than passing on the benefits gained as a result of the monopoly power and exercise of health insurance to consumers.

Not a new problem

Market consolidation is an ongoing issue in the healthcare industry, with analysts often warning about the lack of consolidation and competition between providers such as health systems and hospital groups.

But regardless of which major players are involved, questions about the impact on consumers persist when big companies dominate markets. The federal government is also closely monitoring the issue; In recent months, the Biden administration has identified market consolidation as an area that will be subject to intense regulatory scrutiny.

Anti-competitive acquisitions and practices can create unfair competition, leading to higher health care costs, poor working conditions and less innovation in the health care and pharmaceutical industries, a press release from the Biden administration said in December. Through regulatory and legislative actions, the Federal Trade Commission, the Department of Justice and the Department of Health and Human Services each work to promote competition to lower health care costs for families and taxpayers, and improve health care for patients. Improve quality and availability of care.

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Insurers respond

The industry group American Health Insurance Plans (AHIP) disputed the report, saying competition among insurers has led to lower premium costs in some markets. In a comment to Medset News, AHIP’s senior vice president of telecommunications said the industry is working to lower prices.

Health insurance providers are advocates for Americans, fighting for lower rates and more choices for them, said Christine Grove, vice president of communications at Health Insurance Plans of America, in an email. We negotiate lower prices with doctors, hospitals and pharmaceutical companies, and customers benefit from lower premiums as a result.