The proposed mergers of four of the largest health insurance companies in the United States— Anthem with Cigna, and Aetna with Humana—will likely diminish health insurance competition in 23 states, according to an analysis by the American Medical Association.
The AMA, the largest physician group in the country, released a report on Sept. 8 explaining how these mergers could greatly increase premium costs and negatively impact the quality of healthcare in states such as New York, California, and Texas.
“A lack of competition in health insurer markets is not in the best interests of patients or physicians,” AMA President Steven J. Stack, M.D., said in the press release.
When there is an absence of competition, employers and patients will likely pay higher premiums.
According to the U.S. Department of Justice’s Horizontal Merger Guidelines, “a merger … is likely to encourage one or more firms to raise price, reduce output, diminish innovation, or otherwise harm customers as a result of diminished competitive constraints or incentives.”
“Physicians may be pressured to accept unfair terms that undermine … their ability to provide high-quality care,” Stack said.
A shortage of competition already exists in most local health insurance markets. According to the AMA’s recent study, 46 states have two health insurers with at least a 50 percent share of the commercial health insurance market.
