American Medical Association: Competition in Commercial Health Insurance Decreases Since 2014
The
"Americans in three-quarters of commercial health insurance markets have a limited number of health insurers from which to choose." said
The 2019 edition of Competition in
According to the study, 75 percent of 382 MSA-level markets were highly concentrated. The average MSA-level market had an HHI of 3504 - more than 1000 points over the federal threshold for a highly concentrated market. Widespread market concentration reflects the fact that 91 percent of MSA-level markets had a single insurer with a market share of at least 30 percent.
Several of the study's findings point to worsening conditions. Market concentration levels increased between 2014 and 2018 with the average market HHI rising by 145 points. Fifty-eight percent of markets experienced an increase in the HHI, and in 20 percent of markets the increase was at least 500 points. In markets with a rise in the HHI, the average increase was 498 points.
The study found evidence of increases in concentration in MSA-level markets that were already highly concentrated in 2014, as well as in markets that were not. More than half (54 percent) of the markets that were already highly concentrated became even more so in 2018. Twenty-seven percent of the markets that were not highly concentrated in 2014 experienced an increase in the HHI large enough to place them in the highly concentrated category in 2018.
The broad scope of the
The prospect of future consolidation in the health insurance industry should be viewed in the context of the low levels of competition in most health insurance markets. The
The
* The 10 states with the least competitive commercial health insurance markets were: 1.
* The 10 states that experienced the largest decrease in competition levels between 2017 and 2018 were: 1.
* The five health insurers with the highest market share in the most MSA-level markets were: 1.
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