Wednesday, Nov. 28, 2012
This Week's News
Take advantage of new savings through the AMA Member Value Program
CBO: Cost to delay SGR cut one year $7 billion more than originally thought
Health insurer monopoly power widespread across U.S., study finds
Conference to take on toughest state-level health care issues
AMA website garners national awards for outstanding design, content
This Week's News
Health insurer monopoly power widespread across U.S., study finds
A new AMA study released Wednesday shows a significant absence of health insurer competition for each of the three most popular managed care plans in the United States.
The 2012 edition of the AMA's Competition in Health Insurance: A Comprehensive Study of U.S. Markets found that 70 percent of the 385 metropolitan areas included in the study lacked health insurer competition. These markets are rated "highly concentrated" based on the Horizontal Merger Guidelines issued by the U.S. Department of Justice and the Federal Trade Commission in 2010.
"It appears that consolidation has resulted in the possession and exercise of health insurer monopoly power," the study notes, pointing to increased premiums, watered-down benefits and insurers' growing profitability as evidence that highly concentrated markets harm patients and physicians.
This year's edition is the first time the study has examined insurer competition in the markets for point-of-service plans (POS), in addition to its annual analysis of health maintenance organizations (HMO) and preferred provider organizations (PPO).
"The broad scope of the new AMA analysis provides the most complete picture of the consolidation trend in health insurance markets," AMA President Jeremy A. Lazarus, MD, said in a news release. "The new data demonstrate that most areas of the country have a single health insurer with an anticompetitive share of the HMO, PPO or POS market."
Among the least competitive states, a single insurer accounted for a majority share of the health insurance market. For example, in Alabama a single insurer accounted for 88 percent of the state's health insurance market. The 10 least competitive commercial health insurance markets are in the following states: Alabama, Hawaii, Michigan, Delaware, Alaska, North Dakota, South Carolina, Rhode Island, Wyoming and Nebraska.
To illustrate the study's findings, the AMA also has released maps highlighting the 10 least competitive markets for HMO, PPO and POS plans.
AMA members can order copies of the study free of charge through the AMA Bookstore. Non-members can purchase a copy for $150. Not an AMA member? Join today.
