I like to explore all my options before I make a major purchase and when those options are limited, I feel hamstrung in my ability to make the best choice based on my own needs. And I don't think I'm alone, especially when it comes to health insurance options. Consumers across the country are unable to compare and contrast health plans available to them because four out of five metropolitan areas lack a competitive commercial health insurance market, according to a new American Medical Association (AMA) report.
The AMA found that 83 percent of U.S. metropolitan markets had little competition among health insurers. And in about half of metropolitan markets, at least one health insurer had a majority market share of at least 50 percent. In 24 of the 48 states studied, the two largest health insurers had a combined market share of 70 percent or more.
So now the AMA wants enhanced federal oversight of insurers' mergers and acquisitions, which have been ramping up in the last several months. "High concentration levels in health insurance markets are largely the result of consolidation, which can lead to the exercise of market power and, in turn, harm to consumers and providers of care," the report states. "Past and future consolidation of health insurers should raise serious antitrust concerns."
Not so fast, says America's Health Insurance Plans (AHIP), which not surprisingly, disputed AMA's findings. "Competition is vigorous among health plans across the country," said AHIP spokesman Robert Zirkelbach.
AHIP added that states aren't necessarily the most appropriate market to examine when considering market saturation. Large employers often purchase coverage on a national market, while others buy coverage statewide or in their local community. "Concentration is not the same thing as competition," AHIP said. "Just because one plan has a large market share does not mean that consumers do not have choice of plans."
I, of course, understand why the AMA and AHIP, as representatives of their respective industries, are on opposing sides of this debate, but I would like to think that insurers can recognize how vital competition is in our commercial markets. Just like sports players often want to play on the best team--not the worst team or no team at all--so they can definitively declare themselves the undisputed champions, health insurers should welcome healthy competition so they can prove they're the best of the bunch. It will certainly benefit consumers, and the nation as a whole, to have insurers one-upping each other to offer the best coverage, constantly adding new services to boost their enrollment. Such a competitive marketplace could even incentivize research into alternative care approaches and new payment methods, and improve our overall health as a result. - Dina (@HealthPayer)