With several recent billion-dollar deals bringing together payers and providers, the U.S. healthcare market is consolidating—but the rising concentration isn’t improving quality of care or helping lower costs.
Even in markets with high insurer and provider concentration, consumers aren’t benefiting from lower prices even if health groups can negotiate lower prices, according to the Commonwealth Fund, a private U.S. foundation that supports independent research on healthcare issues.
However, not all markets in the U.S. represent the same levels of concentration, and providers were far more likely to be highly concentrated compared to payers, or insurers, the Commonwealth Fund found.
States play a major role in regulating healthcare provider and insurer markets, but concentration levels are not yet well understood. Concentration variability across the U.S. is wide among providers and payers, according to research from the Commonwealth Fund.
Most providers were either highly concentrated (47.1 percent) or super concentrated (43 percent) among metropolitan statistical areas (MSAs) measured by the Commonwealth Fund. By comparison, 54.5 percent of MSAs were highly concentrated in MSAs and 36.9 percent were moderately concentrated.
More research into marketplace concentration is needed, the Commonwealth Fund argued, to protect consumers and employers from high price and premiums and other impacts of anti-competitive behavior from payers and providers. In addition, federal and state-level regulatory scrutiny may be necessary as consolidation continues.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."