AMA Bashes Health Insurer Monopolies in Many Markets

The report found:

• 99% of metropolitan markets are "highly concentrated" according to federal merger guidelines—an increase from 94% from last year.

• In 54% of the metropolitan markets, at least one insurer had a market share of 50% or greater—an increase from 40% in similar markets the previous year.


• In 92% of the metropolitan markets, at least one insurer had a market share of 30% or greater—an increase from 59% of the metropolitan markets the previous year.

The AMA analyzed 43 states and 313 metropolitan markets against an index used by federal regulators, looking at HMO and PPO enrollment in those areas between 2006 and 2007.

"When an insurer exercises market power in its input market," the AMA study stated, "payments to healthcare providers are below competitive levels. And in both instances, the insurer inefficiently reduces the quality of coverage sold at levels below those produced in a competitive market."

"In short, when market power is exercised by health insurers, it adversely affects consumers' health insurance coverage and healthcare, " the report stated.