AMA Study: 70% of Metro Areas Lack Health Insurer Competition Featured

Written by  Bob Herman | Friday, 30 November 2012 15:08
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Health insurer monopolies and oligopolies are becoming more widespread across the United States, as roughly 70 percent of metropolitans areas lack insurer competition and are "highly concentrated," according to a recent study from the American Medical Association.
For the first time, the AMA's annual study on health insurer trends delved into consolidation trends for 385 metro areas in all 50 states and Washington, D.C. It broke down the country's least competitive markets by commercial health plans, HMOs, PPOs and point-of-service plans.

The AMA study found that roughly 67 percent of metro areas had a health insurer with an HMO market share of 50 percent or greater. Health insurers also had a 50 percent hold on the PPO and POS markets in 68 percent of metro areas.

Alabama was cited as one of the least competitive states for health insurance. One health insurer accounted for 88 percent of the state's commercial market.

While the study hinted that "health insurer monopoly power" and concentrated markets "harm patients and physicians," America's Health Insurance Plans fired back. The health insurance industry's lobbying arm said the AMA's study was based on "significant limitations" and fails "basic checks of accuracy and reliability," according to a statement. AHIP also said higher health costs were associated with the surge of provider mergers.

"Families and employers in every state have multiple choices of both insurance plans and types of coverage," the statement read. "Moreover, research clearly demonstrates that provider consolidation — not concentration of health plan markets — is driving up healthcare costs for consumers and employers."

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