Access to Care

Ensuring health insurance competition

Updated | 6 Min Read
Contents
  1. Anthem-Cigna and Aetna-Humana mergers denied
  2. Efforts to block mergers
  3. Promoting market competition
  4. Model legislation
  5. Contact information

The AMA aims to protect patients and physicians by actively opposing anticompetitive health insurer mergers.

Anthem-Cigna and Aetna-Humana mergers denied

The AMA applauded the two decisions from federal judges blocking the proposed mega-mergers at the trial court level, as well as the federal appeals court decision affirming the decision to block the Anthem-Cigna merger. These decisions cited concerns about the insurers’ negotiation leverage with physicians and providers (Anthem-Cigna) and the erosion of competition in the sale of the Medicare Advantage plans (Aetna-Humana). In addition, the AMA successfully urged the DOJ and state plaintiffs to reject any offers to settle the Anthem-Cigna litigation. These decisions ultimately led Anthem to drop its effort (PDF) to merge with Cigna, and Aetna’s plans to acquire Humana.

Efforts to block mergers

In 2015, four of the five largest health insurers in the U.S. announced their intention to merge. The AMA used its 2016 update to Competition in Health Insurance and other data to conduct analyses of the competitive impacts of the proposed Anthem-Cigna (PDF) and Aetna-Humana (PDF) mergers on commercial markets and the Aetna-Humana merger on Medicare Advantage markets (PDF). Those analyses found that both mergers would likely be anticompetitive in numerous markets across the U.S.

On Nov. 11, 2015, the AMA urged the U.S. Department of Justice (DOJ) to oppose both mergers. The AMA also engaged the National Association of Attorneys General to convince key state attorneys general (AGs) to join the DOJ in opposing the mergers.

To support its arguments, the AMA marshalled leading economists and legal experts as well as conducted extensive physician surveys (in conjunction with state medical association partners) to gauge impact on patient care. The AMA continued to work closely with like-minded stakeholders and led the 17-state medical society coalition in opposing the mergers.

On April 28, 2017, the U.S. Court of Appeals in Washington, D.C. upheld the lower court’s decision to block the Anthem-Cigna merger. The AMA filed an amicus brief in that case, in which the AMA argued (among many other key points) that the trial court properly found that Anthem's reimbursement cuts, rather than enhancing consumer welfare, could cause quality to degrade and consumers to be deprived of choice. At the AMA’s suggestion, the nation’s experts on antitrust and competition submitted their own amicus brief that supported our contention. On May 12, Anthem abandoned the Cigna merger.

Efforts to block mergers correspondence and statements

Promoting market competition

Bolstered by these huge wins, the AMA will continue its antitrust advocacy to protect patient and physician interests. Health insurance market concentration will continue to be a vital issue of public policy for the AMA, the federation of medicine, and the nation’s physicians and patients.

A useful indicator of competition and market power is market concentration. The DOJ and the Federal Trade Commission (FTC) examine market shares and market concentration in their evaluation of proposed mergers between firms. They describe how they will analyze mergers in their 2023 Merger Guidelines.

The AMA’s 2025 update to Competition in Health Insurance: A Comprehensive Study of U.S. Markets (PDF) presents 2024 data on the degree of competition in commercial and Medicare Advantage health insurance markets. It is intended to help identify areas where consolidation among health insurers may cause anticompetitive harm to consumers of health insurance and consumers and providers of care.

The study reports the two largest insurers’ market shares and market concentration levels (HHIs) for state- and MSA-level markets across the U.S. It finds that the vast majority of health insurance markets remain stubbornly highly concentrated. Therefore, they are a risk for insurer mergers to substantially lessen competition. 

Key findings from the 2025 update include:

Commercial markets

  • The average MSA-level market HHI rose from 3322 in 2014 to 3486 in 2024—an increase of 164 points. However, the exchanges tempered that increase. Excluding the exchanges, the average HHI went up by 418 points.
  • Ninety-seven percent (372) of MSA-level markets were highly concentrated (HHI>1,800) in 2024—up from 95% in 2014, based on the 2023 Merger Guidelines.
  • In 91% (350) of MSAs, at least one insurer held a commercial market share of 30% or greater, and in 47% (179) of MSAs, one insurer's share was at least 50%.
  • A Blue Cross Blue Shield (BCBS) insurer had the largest state-level market share in 43 states.
  • A BCBS insurer had the largest MSA-level market share in 84% (321) of MSAs.
  • Elevance Health (BCBS) had the largest MSA-level market share in 21% (82) of MSAs.
  • Nationally, UnitedHealth Group was the largest commercial health insurer, and Centene was the largest insurer in the exchanges. Collectively, however, BCBS insurers would be the largest with a combined commercial market share of 43%.

Medicare Advantage markets

  • There was a decrease in Medicare Advantage market concentration over time; however, the vast majority of markets remain highly concentrated.
  • The average MSA-level market HHI across was 3056 in 2024—down from 3923 in 2017.
  • Nonetheless, 97% (372) of MSA-level markets were highly concentrated (HHI>1,800) in 2024—down only slightly from 99% in 2017.
  • In 90% (345) of MSAs, at least one insurer held a market share of 30% or greater, and in 24% (92) of MSAs, one insurer's share was at least 50%.
  • Nationally, UnitedHealth Group was the largest health insurer with a 30% share in 2024—up from 25% in 2017.
  • UnitedHealth Group had the largest MSA-level market share in 44% (169) of MSAs, and Humana was the biggest in 23% (87) of MSAs.

High insurance market concentration is an important public policy issue because it poses a substantial risk of harm to consumers by:

  • Increasing health insurance premiums rather than lowering health care costs
  • Reducing insurers’ incentives to offer broader networks and to respond to patients’ access needs
  • Limiting patient choice
  • Compromising physician-patient advocacy
  • Undermining access and quality due to physician payments below competitive levels.

A research article by AMA economists (PDF) that examined the price effects of a 2008 merger between UnitedHealth Group and Sierra Health Services found that health plan premiums in Nevada markets increased by 13.7% after the merger.

Model legislation

The AMA developed three model bills to help oppose anticompetitive mergers at the state level. The bills are designed to bring transparency to merger review, protect physicians from retaliation from health insurers and reduce the influence that the health insurance industry has on state insurance regulators. State medical associations can introduce one or more bills in their respective legislative sessions.

Contact information

Please contact Kai Sternstein, vice president of the Advocacy Resource Center, for more information and resources on health insurer mergers.

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