The 2017 edition of the American Medical Association’s (AMA) annual report, entitled "Competition in Health Insurance: A Comprehensive Study of U.S. Markets," reports that, based on 2016 data: (1) 69 percent (270) of 389 metropolitan statistical areas (MSA)-level markets studied were highly concentrated; (2) the average market concentration level across MSA-level markets was 3353; (3) in 89 percent (347) of MSAs, at least one insurer held a commercial market share of 30 percent or greater; and (4) in 43 percent (169) of MSAs, one health insurer’s share of the market was at least 50 percent.
The 16th edition of this annual report examined market concentration in all 50 states, the District of Columbia and in 389 MSAs. It presents 2016 data on commercial enrollment in fully and self-insured health maintenance organizations (HMOs), preferred provider organizations (PPOs), point-of-service (POS) plans, consumer-driven health plans and public health exchanges (EXCH). It is intended to help identify areas where consolidation among health insurers may cause anticompetitive harm to consumers and providers of care, resulting in higher premiums for patients and lower payments to providers.
State market concentration. According to a summary of the annual report by AMA News, during 2016, the commercial health insurance markets became more concentrated in 27 states. Alabama had the least competitive health insurance market of all the states in 2016, with one insurer, Blue Cross Blue Shield of Alabama, holding an 83 percent market share. Delaware had the second least competitive health insurance market in 2016, with one insurer, Highmark, holding a 68 percent market share. The other 10 least competitive health insurance markets in 2016 were Hawaii, South Carolina, Louisiana, Michigan, Kentucky, Vermont, Alaska and Illinois, in that order.
AMA News also reports that in 2016:
- 69 percent of the combined HMO-PPO-POS-EXCH markets were highly concentrated, with 43 percent of MSAs having one insurer with a market share of 50 percent or greater.
- 94 percent of HMO markets were highly concentrated, with 73 percent of MSAs having one insurer with a market share of 50 percent or greater, and in 34 percent of MSAs, one insurer had an HMO market share of 70 percent or greater.
- 86 percent of PPO markets were highly concentrated, with 58 percent of the MSAs having one insurer with a market share of 50 percent or greater, and in 25 percent of the MSAs, one insurer had a market share of 70 percent or greater.
- 100 percent of POS markets were highly concentrated.
Reduced competition. AMA News further reports that the 2016 data shows that Anthem had the biggest geographic footprint in 2016, and was the largest health insurer by market share in 82 of 389 MSAs examined. Health Care Service Corp. was second with a market share lead in 42 MSAs. UnitedHealth Group was third with a leading market share lead in 26 MSAs.
Companies: Anthem; Health Care Service Corp.; UnitedHealth Group; American Medical Association
IndustryNews: NewsStory NewsFeed AccessNews GeneralNews HealthInsuranceExchangeNews InsurerNews
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