Post by unlawflcombatnt on Nov 5, 2009 14:18:24 GMT -6
from American Medical News:
Insurer consolidation deserves critical look
October 19, 2009
"The numbers tell much of the story: In the last 10 years, there have been more than 400 health plan mergers. 94% of health insurance markets in the U.S. are deemed "highly concentrated" --dominated by 1 or 2 health plans -- mostly the result of consolidation of insurers.
In more than 40% of metropolitan statistical areas...1 insurer had a market share of 50% or more.
Those figures were compiled by the American Medical Association, which for the past 8 years has conducted in-depth studies on health insurance markets across the nation. And both the numbers and the consequences that can flow from them raise serious concerns for both patients and physicians.
The 2008 report, the AMA's latest, said it appears that insurer consolidation has resulted in the exercise of health insurer monopoly power -- raising and maintaining premiums above competitive levels -- instead of enhancing efficiency and lowering premiums.
Physicians in many parts of the country, particularly those in small practices, have lost bargaining power with insurers. Too few plans in a market means that in their role as purchasers of health care services -- the monopsony flip side of monopoly -- they do not have to negotiate a fair price or contract terms.
The AMA has long put the spotlight on health plan consolidation and called for antitrust enforcement that took into greater account the potential negative results of health plans allowed to become too big.
So it is welcome news that federal antitrust enforcers have announced sessions that may lead to a revision of the guidelines that determine how future health insurance mergers get approved....
In September, the Federal Trade Commission and the Dept. of Justice announced that they will solicit public comments and hold joint public workshops to consider updating "horizontal" -- consolidation within the same market -- merger guidelines for all businesses. The guidelines are used by both agencies to evaluate the potential competitive effects of mergers and acquisitions, and they have not been revised significantly since 1992. The public input will help the agencies take into account what legal and economic developments have occurred in the 17 years since the last major revision....
The time has come to revise the merger guidelines, according to the FTC chair. And the head of the Dept. of Justice's antitrust division....Both agencies want to determine if the guidelines should be amended to provide consumers and businesses with better protection from anticompetitive mergers.
Much attention these days -- and rightly so -- is given to health system reform on a grand scale. Enhanced antitrust enforcement of insurers is a health system reform, too -- one that helps protect the competition that benefits patients and helps the sustainability of the practices that serve them."
www.ama-assn.org/amednews/2009/10/19/edsa1019.htm
Insurer consolidation deserves critical look
October 19, 2009
"The numbers tell much of the story: In the last 10 years, there have been more than 400 health plan mergers. 94% of health insurance markets in the U.S. are deemed "highly concentrated" --dominated by 1 or 2 health plans -- mostly the result of consolidation of insurers.
In more than 40% of metropolitan statistical areas...1 insurer had a market share of 50% or more.
Those figures were compiled by the American Medical Association, which for the past 8 years has conducted in-depth studies on health insurance markets across the nation. And both the numbers and the consequences that can flow from them raise serious concerns for both patients and physicians.
The 2008 report, the AMA's latest, said it appears that insurer consolidation has resulted in the exercise of health insurer monopoly power -- raising and maintaining premiums above competitive levels -- instead of enhancing efficiency and lowering premiums.
Physicians in many parts of the country, particularly those in small practices, have lost bargaining power with insurers. Too few plans in a market means that in their role as purchasers of health care services -- the monopsony flip side of monopoly -- they do not have to negotiate a fair price or contract terms.
The AMA has long put the spotlight on health plan consolidation and called for antitrust enforcement that took into greater account the potential negative results of health plans allowed to become too big.
So it is welcome news that federal antitrust enforcers have announced sessions that may lead to a revision of the guidelines that determine how future health insurance mergers get approved....
In September, the Federal Trade Commission and the Dept. of Justice announced that they will solicit public comments and hold joint public workshops to consider updating "horizontal" -- consolidation within the same market -- merger guidelines for all businesses. The guidelines are used by both agencies to evaluate the potential competitive effects of mergers and acquisitions, and they have not been revised significantly since 1992. The public input will help the agencies take into account what legal and economic developments have occurred in the 17 years since the last major revision....
The time has come to revise the merger guidelines, according to the FTC chair. And the head of the Dept. of Justice's antitrust division....Both agencies want to determine if the guidelines should be amended to provide consumers and businesses with better protection from anticompetitive mergers.
Much attention these days -- and rightly so -- is given to health system reform on a grand scale. Enhanced antitrust enforcement of insurers is a health system reform, too -- one that helps protect the competition that benefits patients and helps the sustainability of the practices that serve them."
www.ama-assn.org/amednews/2009/10/19/edsa1019.htm