To protect consumers, more scrutiny needed of consolidated healthcare markets

August 29, 2018

money with stethoscopeA team of health economists at the School of Public Health have highlighted a trend in the healthcare market: higher health care prices and insurance premiums, but not necessarily a higher quality of care. The reason? Market consolidation and potential anticompetitive behavior.

The commentary was published on the To The Point blog on the website of The Commonwealth Fund and analyzes health care market concentrations across the United States by metropolitan statistical areas (MSA). The authors briefly discuss what these numbers mean for state and federal regulation.

They begin the post, “Over the past several decades in the United States, more and more health care providers and health insurers have consolidated, increasing their market power,” a trend revealed in their research and supported by similar findings at peer institutions. Though market concentration varies among MSAs, the numbers show increasing consolidation.

This could lead to higher prices for the same quality of care. Therefore, the authors call for more state and federal regulatory scrutiny to protect customers and employers from potential anticompetitive behavior in this increasingly monopolized market.

The authors are Brent D. Fulton, PhD, MBA, assistant adjunct professor of Health Economics and Policy; Daniel Arnold PhD, a postdoctoral researcher in Health Economics; and Richard M. Scheffler PhD, professor emeritus of Health Economics and Public Policy. All three researchers are members of the Nicholas C. Petris Center, a health economics research center housed at the School.

Read the analysis