AMA: 70% of health insurance markets 'highly concentrated'
AHA News Now
Nov 30, 2012
Most U.S. health insurance markets are highly concentrated, according to a report released this week by the American Medical Association. Examining market share and concentration levels for health maintenance organizations, preferred provider organizations and point-of-service plans in 385 metropolitan areas, the study found 70% of the markets are rated "highly concentrated" based on 2010 Horizontal Merger Guidelines issued by the U.S. Department of Justice and Federal Trade Commission. In 89% of the areas, at least one insurer held a commercial market share of 30% or more. "In sum, the majority of health insurance markets in the United States are highly concentrated," the report states. "Coupled with the concomitant large increases in premiums, insurer profitability, lower scope of benefits and high barriers to entry, this strongly suggests that health insurers are exercising market power in many parts of the country and in turn causing competitive harm to consumers and providers of care."