Threats to leave a commercial health coverage network during hospital-insurer negotiations are most common when the two sides control a substantial, but not too large, share of the local market, according to a Brown University analysis recently published in Health Affairs.
The study of network negotiations with contracts ending between August 2021 and July 2025 also highlighted for-profit hospitals, those with positive operating margins, those with median or below cash on hand and those in metro areas as more frequently making a public threat to exit a network, referred to as brinkmanship by the researchers. Additionally, threats to pull the plug were more common when a national payer was involved in the negotiations and when a hospital had already been securing higher rates under the prior contract.
More broadly, the researchers found that public threats to end a contractual relationship occurred in about 8% of their sample. Twenty-eight percent of those brinkmanship events, or 2% of the total, ultimately led to a network exit.
Those rates are somewhat higher than what has been described in industry reports, the researchers wrote. And though their analysis was not designed to describe changes in these patterns over time, most of the events occurred in the sample’s later years and as the implementation of public price transparency requirements increased, the researchers noted. Other factors that could potentially have fueled increased brinkmanship in recent years include the expiry of pandemic financial supports, the cumulative effects of operating costs (like labor) that mounted during the emergency and “reduced anticipated negative publicity,” they wrote.
Jason Buxbaum, an assistant professor in the Department of Health Services, Policy and Practice at Brown’s School of Public Health and the study’s lead author, said in a release from the institution that news stories surrounding brinkmanship and de-participation have become regular features in local news media, but on their own rarely extend outside the affected area.
“But when you gather all these isolated disputes, add them together and quantify how often these tactics are deployed, it’s clear that there’s a real national issue,” he said. “Patients and families are regularly caught in the middle as hospitals and insurers negotiate better deals for themselves.”
Buxbaum and colleagues did note in their study that patients in these areas are being protected somewhat by the No Surprises Act of 2021’s 90-day transitional coverage periods and, to a lesser extent, by states with continuity-of-care laws. Cases where the two sides eventually come together after a gap in participation also often include retroactive coverage for care delivered during the out-of-network period.
“But coverage lapses have extended past the care continuity period, and uncertainty can lead to distress among the patients involved,” they wrote while highlighting news reports of individuals heavily affected by the disputes.
The researchers used natural language processing to identify reports of public-facing brinkmanship among a database of over 1,300 indexed news sources. Other government and market sources were used to more accurately specify payer negotiations at the division-level and characterize hospitals and insurers. The full sample included nearly 15,000 relationships between 3,772 hospitals and 92 commercial health insurers, with 1,249 cases of a public threat to end a contract.
The findings suggest that these negotiations, and their subsequent impacts on access and healthcare prices, are highly dependent on local characteristics of a market and its participants.
Of note, the researchers highlighted what they described as a “Goldilocks zone,” in which brinkmanship was more common when the respective sides had substantial but not overwhelming market control (25% to 45% of inpatient capacity for hospitals, 30% to 45% of commercial membership for payers). The effect, they theorized, could stem from two opposing factors: the financial impact of cutting off services to a large share of patients on one end of the scale, and reputational risks outweighing immediate monetary impact of a low-volume partnership on the other.
While commercial market negotiations largely center on issues of price, those in Medicare Advantage also involve factors like care denials and utilization management. Future research on hospital-insurer brinkmanship should next focus on this market, as well as longitudinal trends, to help policymakers “critically assess both the effectiveness of aggressive negotiations as a means to control costs and the impact of aggressive negotiations on consumers’ access and experiences,” the study concludes.