Ensuring health insurance competition | American Medical Association

The AMA goals to guard sufferers and physicians by actively opposing anticompetitive health insurer mergers.

The AMA applauded the 2 choices from federal judges blocking the proposed mega-mergers on the trial court docket degree, in addition to the federal appeals court docket choice affirming the choice to dam the Anthem-Cigna merger. These choices cited issues concerning the insurers’ negotiation leverage with physicians and suppliers (Anthem-Cigna) and the erosion of competition within the sale of the Medicare Advantage plans (Aetna-Humana). In addition, the AMA efficiently urged the DOJ and state plaintiffs to reject any presents to settle the Anthem-Cigna litigation. These choices in the end led Anthem to drop its effort (PDF) to merge with Cigna, and Aetna’s plans to accumulate Humana.

In 2015, 4 of the 5 largest health insurers within the U.S. introduced their intention to merge. The AMA used its 2016 replace to Competition in Health Insurance and different information to conduct analyses of the aggressive impacts of the proposed Anthem-Cigna (PDF) and Aetna-Humana (PDF) mergers on business markets and the Aetna-Humana merger on Medicare Advantage markets (PDF). Those analyses discovered that each mergers would probably be anticompetitive in quite a few markets throughout the U.S.

On Nov. 11, 2015, the AMA urged the U.S. Department of Justice (DOJ) to oppose each mergers. The AMA additionally engaged the National Association of Attorneys General to persuade key state attorneys common (AGs) to affix the DOJ in opposing the mergers.

To help its arguments, the AMA marshalled main economists and authorized consultants in addition to performed intensive doctor surveys (along side state medical affiliation companions) to gauge affect on affected person care. The AMA continued to work carefully with like-minded stakeholders and led the 17-state medical society coalition in opposing the mergers.

On April 28, 2017, the U.S. Court of Appeals in Washington, D.C. upheld the decrease court docket’s choice to dam the Anthem-Cigna merger. The AMA filed an amicus temporary in that case, by which the AMA argued (amongst many different key factors) that the trial court docket correctly discovered that Anthem’s reimbursement cuts, moderately than enhancing shopper welfare, might trigger high quality to degrade and shoppers to be disadvantaged of selection. At the AMA’s suggestion, the nation’s consultants on antitrust and competition submitted their very own amicus temporary that supported our competition. On May 12, Anthem deserted the Cigna merger.

Efforts to dam mergers correspondence and statements

• AMA letter urging DOJ and state plaintiffs to steadfastly oppose Anthem/CIGNA merge (Comment letter, Feb. 28, 2017)
• AMA testimony to CA insurance commissioner (Statement for the report, March 29, 2016)
• AMA letter to FL Attorney General (Comment letter, May 31, 2016)
• AMA letter to FL Insurance Commissioner (Comment letter, Dec. 17, 2015)
• AMA testimony to GA insurance commissioner (Statement for the report, July 21, 2016)
• AMA testimony to IN insurance commissioner (Statement for the report, April 26, 2016)
• AMA testimony to MO insurance commissioner (Statement for the report, May 19, 2016)
• Letter from main health economists to FL Attorney General (Sign-on letter, July 8, 2016)
• Consumer letter regarding medical loss ratio (Sign-on letter, July 8, 2016)

Bolstered by these large wins, the AMA will proceed its antitrust advocacy to guard affected person and doctor pursuits. Health insurance market focus will proceed to be an important situation of public coverage for the AMA, the federation of drugs, and the nation’s physicians and sufferers.

The AMA’s 2022 replace to Competition in Health Insurance: A Comprehensive Study of U.S. Markets (PDF) presents 2021 information on the diploma of competition in business health insurance markets, and for the primary time, in Medicare Advantage markets. It is meant to assist establish areas the place consolidation amongst health insurers could trigger anticompetitive hurt to shoppers and suppliers of care.

The examine reviews the 2 largest insurers’ market shares and focus ranges (HHIs) for state- and MSA-level markets throughout the U.S.

Key findings from the 2022 replace embrace:

Commercial markets

• Seventy-five p.c (287) of MSA-level markets have been extremely concentrated (HHI>2,500) in 2021, up from 71% in 2014.
• The common HHI throughout MSA-level markets was 3504 in 2021.
• Fifty-eight p.c of markets skilled a rise within the HHI between 2014 and 2021. Among these markets, the typical enhance was 540 factors.
• Of the markets that weren’t extremely concentrated in 2014, 30% skilled a rise within the HHI giant sufficient to position them within the extremely concentrated class by 2021. Another 33% additionally had a rise, although not giant sufficient to make them extremely concentrated.
• In 91% (349) of MSAs, at the least one insurer held a business market share of 30% or higher, and in 48% (183) of MSAs, one insurer’s share was at the least 50%.

Medicare Advantage markets

• Seventy-nine p.c (299) of MSA-level markets have been extremely concentrated (HHI>2,500) in 2021, down from 87% in 2017.
• The common HHI throughout MSA-level markets was 3331 in 2021.
• In 91% (347) of MSAs, at the least one insurer held a market share of 30% or higher, and in 34% (131) of MSAs, one insurer’s share was at the least 50%.
• At the nationwide degree, UnitedHealth Group was the biggest health insurer within the U.S.

High insurance market focus is a vital public coverage situation as a result of it poses a considerable threat of hurt to sufferers by:

• Increasing health insurance premiums moderately than reducing health care prices
• Reducing insurers’ incentives to supply broader networks and to reply to sufferers’ entry wants
• Limiting affected person selection
• Compromising physician-patient advocacy
• Undermining entry and high quality on account of doctor funds under aggressive ranges.

A analysis article by AMA economists (PDF) that examined the value results of a 2008 merger between UnitedHealth Group and Sierra Health Services discovered that health plan premiums in Nevada markets elevated by 13.7% after the merger.

The AMA developed three mannequin payments to assist oppose anticompetitive mergers on the state degree. The payments are designed to carry transparency to merger assessment, defend physicians from retaliation from health insurers and cut back the affect that the health insurance trade has on state insurance regulators. State medical associations can introduce a number of payments of their respective legislative classes.

Please contact Kai Sternstein, vice chairman of the Advocacy Resource Center, for extra data and sources on health insurer mergers.