MarketWatch: Insurers' power growing into monopolies

[marmar]

Feb. 23, 2010, 8:20 p.m. EST

Insurers' market power growing, study finds
AMA examination finds virtually all markets 'concentrated'

By Russ Britt, MarketWatch


LOS ANGELES (MarketWatch) -- Amid growing discontent with the nation's health insurers, a new study shows the market power of individual carriers continues to grow, with 99% of all metropolitan areas considered to be at near-monopolistic levels.

The study from the American Medical Association shows that 309 of the 313 metropolitan areas in 43 states are "highly concentrated," or at a level that otherwise would incur Department of Justice and Federal Trade Commission scrutiny.

That's up from a 2009 AMA study on the same subject, which showed that 94% of all major metropolitan markets were highly concentrated. The study cites the Herfindahl-Hirschman Index, or HHI, which is used by the DOJ and FTC in evaluating potential corporate mergers for possible antitrust concerns.

"Virtually all commercial health insurance markets in the United States are highly concentrated. These markets are ripe for the exercise of health insurer market power, which is detrimental to society," the study says. The study is from data collected in January 2007. ..........(more)

The complete piece is at: http://www.marketwatch.com/story/insurers-market-power-growing-study-finds-2010-02-23

[Donnachaidh]

1. so WHY are we basically handing them MORE power?

This Senate bill is a big ole gift to the monopolies.

[kenny blankenship]

2. The word is Cartel (or oligopoly). Most mature industries are oligopolies.

Insurance is a very mature industry, and marked with all the bad traits of oligopolies - rent seeking behavior, non-competes, high prices.

Giving them quasi-governmental status, investing them with authority over every citizen's income, setting them up as a bureaucracy which every citizen must satisfy and obtain leave from annually to go on living, enlisting the coercive powers of government to act as their collection agency - this is a very, very bad idea. Unless of course you are corporate oligarch, or an old fashioned elitist, or a new fangled fascist.