AMA quantifies Cigna and Humana deal effects on market competition

In the report on the proposed Aetna-Humana deal, the AMA says Kentucky and Texas now have commercial health insurance market HHIs between 2,500 and 3,000. If regulators let Aetna complete the Humana deal as is, that would push the HHI in Kentucky over 3,000, and the HHI in Texas over 2,500, the AMA says.

Dr. Steven Stack, president of the AMA, put out a statement urging federal and state regulators to “use enforcement tools to preserve competition.”

“If a health insurer merger is likely to erode competition, employers and patients may be charged higher-than-competitive premiums, and physicians may be pressured to accept unfair terms that undermine their role as patient advocates and their ability to provide high-quality care,” Stack said.

See also: Kaiser: PPACA shuffles market share

America’s Health Insurance Plans (AHIP) fired back with a press release accusing the AMA of “recycling misleading data that does not accurately reflect the market today.”

The AMA comes up with much higher health insurance market concentration figures than the National Association of Insurance Commissioners (NAIC) does, in part because the AMA ignores major segments of the self-insured employer plan market, AHIP says.

AHIP also repeated earlier arguments that hospital consolidation has been one of the forces responsible for driving up U.S. health care costs in recent years.