Almost three-fourths of U.S. metropolitan areas lacked a competitive health insurance market in 2020, with shrinking options among payers harming patients and providers, the American Medical Association concluded in a study published Tuesday. In 91% of regions, a single insurer held at least 30% of the commercial markets, the medical society found.
Large health insurance companies dominated the commercial and Medicare Advantage markets in 2021, with consolidation shrinking competition and inflating premiums, the American Medical Association reports in their study.
Competition was even weaker in the Medicare Advantage market: Nearly 80% of the 380 metropolitan statistical areas surveyed were “highly concentrated.”
“Unchecked market power among insurers is a formula for higher premiums, lower coverage and inadequate levels of patient care, concerns of great relevance to Medicare Advantage,” AMA President Dr. Jack Resneck Jr. said in a news release. “Most large Medicare Advantage insurers are accused of fraud and flouting the authority of federal agencies.”
Poor competition in health insurance markets also disadvantages physicians, particularly independent providers who lack the clout to negotiate higher reimbursements, the report says.
UnitedHealthcare is the largest insurer in both the commercial and Medicare Advantage markets with 51.3 million members, while Blue Cross and Blue Shield companies collectively have the largest geographic footprint.
Elevance Health, formerly Anthem, is the largest insurer by market share in 82 of 383 metro areas, according to the study. Health Care Service Corp.. which sells Blue Cross and Blue Shield plans in Illinois, Montana, New Mexico, Oklahoma, and Texas, is the second-largest and Florida Blue came in third.
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