Our Research in the Media

Dr. Scheffler and Dr. Arnold’s new paper “Insurer Market Power Lowers Prices In Numerous Concentrated Provider Markets” was released in Health Affairs this week. The paper uses prices of hospital admissions and visits to five types of physicians to analyze how provider and insurer market concentration—as measured by the Herfindahl-Hirschman Index (HHI)—interact and are correlated with prices. Scheffler and Arnold find evidence that in the range of the Department of Justice’s and Federal Trade Commission’s definition of a moderately concentrated market (HHI of 1,500–2,500), insurers have the bargaining power to reduce provider prices in highly concentrated provider markets for cardiologist, radiologist, and hematologist/oncologist visit prices. However, a policy dilemma arises from these findings: there are no insurer market mechanisms that will pass a portion of these price reductions on to consumers in the form of lower premiums. The paper concludes that large purchasers of health insurance, such as state and federal governments, as well as the use of regulatory approaches, could provide a solution.

The September issue of Health Affairs features a collection of papers addressing health care market concentration. Earlier versions of these articles were presented at the “Impact of Healthcare Market Concentration on Healthcare Prices and Premiums: What Can and Should Be Done” conference, organized by the Petris Center, at the Robert F. Wagner Graduate School of Public Service, New York University, New York City, on April 14, 2017.

Dr. Brent Fulton’s new paper “Health Care Market Concentration Trends In The United States: Evidence And Policy Responses” was published in Health Affairs this week. Dr. Fulton’s study analyzes market concentration trends in the United States from 2010 to 2016 for hospitals, physician organizations, and health insurers, finding that hospital and physician organization markets became increasingly concentrated over this time period. Concentration among primary care physicians increased the most, partially because hospitals and health care systems acquired primary care physician organizations. The paper finds that a large number of Metropolitan Statistical Areas (MSAs) are highly concentrated – in 2016, reaching 91% for hospitals, 65% for specialist physicians, 39% for primary care physicians, and 57% for insurers. The paper concludes that public policies that enhance competition are needed, such as stricter enforcement of antitrust laws, reducing barriers to entry, and restricting anticompetitive behaviors.

The September issue of Health Affairs features a collection of papers addressing health care market concentration. Earlier versions of these articles were presented at the “Impact of Healthcare Market Concentration on Healthcare Prices and Premiums: What Can and Should Be Done” conference, organized by the Petris Center, at the Robert F. Wagner Graduate School of Public Service, New York University, New York City, on April 14, 2017.

The Petris Center has a new article published in the January issue of Health Affairs, entitled “Consumers Buy Lower-Cost Plans on Covered California, Suggesting Exposure to Premium Increases Less than Commonly Reported.” The paper was authored by the Petris Center’s Graduate Student Researcher Daniel Arnold, Dr. Brent Fulton, and Dr. Scheffler, along with Jon Gabel and researchers from NORC.

The full article can be read on Health Affair’s website here.