Fewer insurers can mean more frustration for physicians

Adequate competition among health insurers is essential to maintaining a practice that allows doctors to put patients’ needs first and have desirable agreements with insurance companies.

However, most health insurance markets lack significant competition, according to a new study by the American Medical Association (AMA).

"When insurers dominate a market, people pay higher health insurance premiums than they should, and physicians are pressured to accept unfair contract terms and corporate policies, which undermines the physician role as patient advocate," says AMA President Cecil B. Wilson, MD.

The latest edition of Competition in Health Insurance: A Comprehensive Study of U.S. Markets includes data from 359 metropolitan statistical areas in 46 states. Of these markets, 99% are considered highly concentrated. A majority (60%) of markets are dominated by the two largest insurers. Such saturation can severely affect the way doctors have to run their practices.

According to the study, 78% of office-based practices have nine or fewer physicians, and most have two to four, making physicians the least concentrated section of healthcare.