The American Medical Association (AMA) has released a comprehensive report highlighting potential harm to consumers and healthcare providers due to limited competition in the insurance market. The report identifies major insurers dominating the commercial health insurance, Medicare Advantage plans, and public health exchanges under the Affordable Care Act (ACA).
AMA President, Jesse M. Ehrenfeld, M.D., M.P.H., emphasized the adverse effects of high market concentration on patients, leading to elevated insurance premiums. He advocated for revising federal guidelines to lower the threshold for considering markets highly concentrated, aiming to scrutinize and potentially limit detrimental insurance mergers.
According to the AMA’s findings, the ten largest commercial health insurers nationally are UnitedHealth Group (14%), Elevance Health (12%), CVS (Aetna) (11%), Cigna (10%), Kaiser Permanente (7%), Health Care Service Corp. (6%), Blue Cross Blue Shield of Michigan (2%), Blue Cross Blue Shield of Florida (2%), Blue Shield of California (2%), and Highmark (2%).
In the Medicare Advantage market, UnitedHealth Group leads with a 42% market share, followed by Humana at 22% and CVS (Aetna) at 7%.
For ACA markets, 90% of metropolitan statistical areas (MSAs) were highly concentrated in 2022, with one health insurer holding a market share of at least 50% in 67% of MSAs.
The report scrutinized 381 MSAs nationwide, revealing that 73% of MSA commercial markets were highly concentrated, with a single insurer holding a share of at least 50% in 48% of markets.
The analysis indicated a continuous rise in market concentration from 71% to 73% between 2014 and 2022, highlighting the persistent challenge. The report attributes this trend to mergers and acquisitions, expressing concerns about potential antitrust issues.
The AMA’s concerns echo broader worries about market consolidation in the healthcare industry, prompting increased regulatory scrutiny from the Biden Administration. Insurers, represented by America’s Health Insurance Plans (AHIP), countered the report’s findings, asserting that competition has led to reduced premium costs in certain markets and emphasizing their commitment to negotiating lower prices for consumers.
As market concentration remains a contentious issue, the healthcare industry and regulatory bodies face ongoing challenges to strike a balance between fair competition, cost-effectiveness, and consumer welfare.
