How to Destabilize Insurance Markets Without Really Trying

Cross-posted from the Take Care blog

On Thursday, Senate Majority Leader Mitch McConnell released the latest draft of his effort to repeal the Affordable Care Act (ACA). As of last night, it appears that this version of the bill is dead, with four Senators declaring that they won’t vote to move it forward. But provisions of this bill are worth talking about, both for what they reveal about health insurance and for what they reveal about the process by which the Senate is considering ACA repeal.  The latest draft contains a number of new provisions, but two caught my eye: (1) Senator Ted Cruz’s attempt to bifurcate the individual insurance market and (2) a clause about membership in a health care sharing ministry as satisfying the requirement of “continuous creditable coverage.”

The Cruz amendment has received a large amount of coverage both in the popular press and by more specialized policy outlets. But there has been little attention to the clause about health care sharing ministries. Fortunately, I wrote a 5,000 word book chapter on the ministries as part of an academic conference in 2015 (here I am presenting on the topic, if you’re really interested). Continue reading

Will the Recent Workplace Wellness Bill Really Undermine Employee Health Privacy?

By Jessica L. Roberts

While the effort to repeal and replace the Affordable Care Act (ACA) has taken center stage, another health-related bill has been making its way through the House without nearly as much attention. On March 2, 2017, Representative Virginia Foxx (R-NC) introduced House Resolution (HR) 1313 on behalf of herself and Representative Tim Walberg (R-MI).   The bill would lift current legal restrictions on access to genetic and other health-related information. Specifically, HR 1313 targets provisions of the Americans with Disabilities Act (ADA) that prohibit employers from conducting unnecessary medical examinations and inquiries that do not relate to job performance; the Genetic Information Nondiscrimination Act’s (GINA) provisions proscribing employers from requesting, requiring or purchasing the genetic information of their employees; and GINA’s prohibition on group health insurance plans acquiring genetic information for underwriting purposes and prior to enrollment. The bill passed through the Committee on Education and the Workforce last Wednesday along strict party lines with 22 Republicans supporting the proposed legislation and 17 Democrats opposing it.

Despite the public outcry against the bill, HR 1313 may not be as far-reaching as it initially appears. First, while advocates of genetic privacy fear the worst, both the ADA and GINA contain exceptions for wellness programs that already allow employers to access at least some employee health data. Second, even if HR 1313 passes, employees would still enjoy the ADA’s and GINA’s antidiscrimination protections.   HR 1313 could well give employers additional access to genetic and other health-related information about their employees but it is not a license to then use that information to discriminate.

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Medicare Advantage Might Have Potential — If Companies Play Fair

By Shailin Thomas

Medicare Advantage was introduced as a mechanism for capturing some of the oft-extolled efficiencies of the private health insurance market. Instead of paying providers for services directly, as in traditional Medicare, the government pays Medicare Advantage insurers a predetermined, risk-adjusted amount of money per patient to cover all medical expenses for the year. The risk adjustment ensures that companies insuring Medicare Advantage patients with chronic diseases — who will likely need more intensive, expensive care — receive additional funds to help cover those costs. For each qualifying condition a patient has, the Medicare Advantage plan receives on average an additional $3000 annually.

While the risk adjustment of Medicare Advantage payments was well intentioned and economically rational, it appears to have opened up an avenue for significant abuse on the part of Medicare Advantage insurers. The Department of Justice recently joined a lawsuit against UnitedHealth, a large provider of Medicare Advantage plans, for allegedly defrauding the government out of hundreds of millions, if not billions, of dollars. The complaint alleges that UnitedHealth “upcoded” its risk-adjustment claims by submitting for conditions patients did not actually have and refusing to correct false claims when it discovered or should have discovered them. In essence, the company allegedly realized it could extract more money out of the government by making the patients it covers appear sicker than they actually are, and took full advantage of that.

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What is the Meaning of Trump’s Day 1 Executive Order on the ACA?

Guest Post by Erin C. Fuse Brown

On the day of his inauguration, President Trump signed an executive order instructing the executive branch agencies to exercise their discretion and authority to  “waive, defer, grant exemptions from, or delay the implementation of” fees, taxes, or penalties under the Affordable Care Act (ACA).

The order does not specify which “fiscal burdens” it targets, but the individual mandate, the employer mandate, and the various industry and payroll taxes imposed by the law immediately jump to mind. These are all written into the law, and the President cannot unilaterally set them aside. The executive order says it is following the law, including the Administrative Procedure Act, which is good because it means the President is not instructing anyone to flout the law. Even existing ACA rules cannot be undone overnight and can only be changed or repealed through a lengthy notice-and-comment rulemaking process.

There is such a thing as “enforcement discretion,” which some suggest means that the individual mandate won’t be enforced anymore. I’m not so sure. If the President instructed the IRS to stop collecting taxes from billionaires under its enforcement discretion, that wouldn’t be legal. Continue reading

LIVE ONLINE TODAY @ NOON: President-Elect Trump’s Health Policy Agenda: Priorities, Strategies, and Predictions

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Webinar: President-Elect Trump’s Health Policy Agenda: Priorities, Strategies, and Predictions

Monday, December 19, 2016, 12:00 – 1:00pm

WATCH LIVE ONLINE!: http://petrieflom.law.harvard.edu/events/details/president-elect-trumps-health-policy-agenda

Submit your questions to the panelists via Twitter @PetrieFlom.

Please join the Petrie-Flom Center for a live webinar to address what health care reform may look like under the new administration. Expert panelists will address the future of the Affordable Care Act under a “repeal and replace” strategy, alternative approaches to insurance coverage and access to care, the problem of high drug prices, innovation policy, support for scientific research, and other topics. The panel will discuss opportunities and obstacles relevant to President-elect Trump’s proposals, as well as hopes and concerns for health policy over the next four years. Webinar participants will have the opportunity to submit questions to the panelists for discussion.

Panelists

  • Joseph R. Antos, Wilson H. Taylor Scholar in Health Care and Retirement Policy, American Enterprise Institute
  • Lanhee J. Chen, David and Diane Steffy Research Fellow, Hoover Institution; Director of Domestic Policy Studies and Lecturer, Public Policy Program; affiliate, Freeman Spogli Institute for International Studies, Stanford University
  • Douglas Holtz-Eakin, President, American Action Forum
  • Moderator:Gregory Curfman, Editor-in-Chief, Harvard Health Publications

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Will Medicare Reform be a Republican Obamacare?

By Shailin Thomas

As the health care community waits with bated breath to see what will become of the Affordable Care Act under the Trump administration, Republicans in Congress have set their sites on another health-related initiative that has been on their wish list for years: reforming Medicare. While Trump promised throughout his campaign not to change the fundamental ways in which Medicare works — in part to appeal to older voters, who overwhelming would like the program to stay as it is — shortly after the election, “modernizing Medicare” appeared as a priority on the transition website for the new administration.

The reform many Republicans are pushing for — championed by Speaker of the House Paul Ryan (R-WI) — is privatization along the lines of Medicare Advantage. Instead of providing for full insurance coverage through the government, as traditional Medicare currently does, Ryan’s proposal would have eligible patients purchase insurance from private companies with financial assistance from the government. The theory is that by having private insurers provide coverage, Medicare will capture efficiencies of the private market, while simultaneously offering consumers more choice in the coverage they receive.

After Paul Ryan first unveiled this plan in 2011, the Kaiser Family Foundation released a report detailing the significant fiscal problems with this “modernized” vision of Medicare. According to the Foundation’s analysis, the average out-of-pocket expense for beneficiaries increase from $5,630 under the current system to $12,500. The reason for this increase, according to the Congressional Budget Office, is that providing coverage is actually more expensive for a private insurer than it is for the government.  The proposal faces other economic challenges as well, and ironically, some of them stem from its close resemblance to Obamacare.

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Health Insurance, Veterinary Care, and the Not-So-Secret Benefits of Pets

By Shailin Thomas

Pet ownership is incredibly popular in the United States. There are almost 70 million companion dogs spread across 43 million American households.   This isn’t particularly surprising, given that study after study has shown that companion animals promote healthier, happier, longer lives for their owners. Despite pet popularity and prevalence, though, many pet owners don’t fully understand how expensive their four-legged family members can be — especially if they end up needing extensive veterinary care. Every year, millions of companion animals are euthanized because their owners lack the financial resources to pay for necessary veterinary services. Unlike in human medicine, pets in the hospital with readily curable ailments often go untreated for financial reasons.

How can we help people keep and care for their pets — capturing companion animal health benefits while also ensuring those pets receive the veterinary care they need? The answer might be found in the synergies between animal and human health — and the benefits they entail for health insurance providers.

The health benefits of companion animals have been extensively documented in both the scientific literature and the mainstream media. Pet owners have, inter alia, decreased risk of cardiovascular disease, decreased risk of anxiety and depression, decreased incidence of allergies, and increased immune system function. Some insurance companies even have materials for their customers promoting pet ownership because of these benefits. The health conditions ameliorated by animal companionship are often otherwise treated with doctor’s visits, medications, and other expensive interventions paid for in large part by insurance providers. In other words, pet ownership produces positive externalities on insurance providers by decreasing the amount they pay in traditional medical services for these ailments — and insurance companies have an interest in incentivizing animal companionship.

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Ambulances are Monopolies — and They Should Be Regulated Accordingly

By Shailin Thomas

You go to your local urgent care with a headache and a fever, and the doctor suggests a trip to the hospital for further evaluation — just to make sure there isn’t anything serious causing your symptoms. She offers an ambulance, and you accept. You could probably walk or Uber, but you’re not feeling well, and the doctor has offered to arrange the ride. Why not?

This was the story of Joanne Freedman. She didn’t think too much about it, until she received a $900 bill for the two-block ambulance ride she took to the hospital. While Joanne’s experience was particularly egregious, it is not wholly uncommon. Ambulance pricing is one of the most variable and least transparent components of health care costs, with rides ranging from tens to thousands of dollars. This is in part because there are many ambulance providers, and they all have different relationships with different insurance companies. It’s also in part because ambulance rates are generally set according to the services the ambulance is equipped to provide, not necessarily the services actually provided. Some ambulance companies have contracts with municipalities that make them the only game in town, while others are in more diverse markets with multiple providers competing for patients. All this combines to create an incredibly complex industry with very little consistency from ambulance to ambulance.

But is this disjointed, free-market system the best way to structure emergency transportation? The arguments underlying the justification of a free, unregulated market hinge on the ability of consumers to police the industry through choice. If the seller of a good sets the price too high, consumers will buy from a different seller until she brings the price down to what consumers are willing to pay.  This is, in theory, what allows markets to find the right prices for goods and services more efficiently than any government agency or regulator ever could. Continue reading

The Evolving Crisis of the ACA Exchange Marketplace

By Zack Buck

Following news last week that Aetna was pulling out of health care insurance exchange markets in eleven states, Pinal County, Arizona became the epicenter in the rapidly evolving and growing crisis facing the Affordable Care Act’s insurance exchanges.  Sandwiched between Phoenix and Tucson, Pinal County is home to about 400,000 residents, but no insurance companies; in short, Pinal County has been left without any insurance companies signed up to sell insurance on the exchange to its residents for 2017—becoming the “county that Obamacare forgot.”

Pinal County had nearly 10,000 citizens sign up on the exchange in 2016, but Aetna’s departure bookends a rough period for Pinal County residents.  In addition to Aetna, the county has recently endured the departure of UnitedHealth Group, Humana, and a non-profit co-op from Arizona’s exchange.  As a result, Pinal County is reportedly looking to other insurers who may be interested in selling on the exchange to its residents; in a bit of hopeful news, Blue Cross Blue Shield of Arizona is said to be “re-evaluating where it will offer plans next year.”

But the crisis isn’t contained to Pinal County.  Two states—Tennessee and Alaska—have been trying to avoid a similar fate.

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Income-Scaling of Cost-Sharing Gains Traction

By Christopher Robertson

With 148,000 members, the American College of Physicians (ACP) is the largest medical-speciality organization.  This summer, its board released a new report on the growing financial burdens faced by patients who enjoy health insurance but are nonetheless exposed to unbearably large costs for healthcare.  At the end of the day, cost-sharing is just the absence of insurance for those costs.

ACP calls for a range of reforms, including “income-adjusted cost-sharing approaches that reduce or directly subsidize the expected out-of-pocket contribution of lower-income workers to avoid creating a barrier to their obtaining needed care.”  As I have argued, the Affordable Care Act includes income-based subsidies for cost-sharing in the Marketplaces, but these are currently being challenged in court, and do not apply to the employer-based system or Medicare, which together cover the vast majority of patients.

Hillary Clinton has also advanced a plan to create progressive refundable tax credits for people who spend more than 5% of their income out-of-pocket.   The advantage of such a tax-based approach is that it reaches patients regardless of where they get their insurance (except for Medicare, which is excluded).  The disadvantage is that it leaves people in a state of financial insecurity until they get their refunds.  A better approach would scale cost-sharing exposure in the first place, a power that I have suggested is already available under Federal law and which is self-funding.

Our Current Pharmaceutical Payment System Isn’t Neutral

By Rachel Sachs

Last week, former Pfizer Global R&D head John LaMattina wrote another of his columns for Forbes, this one on the subject of pay-for-performance deals for pharmaceuticals.  These deals, in which insurers contract with pharmaceutical companies to pay for drugs based on how well they perform in practice, are becoming more common as the public conversation over drug prices escalates (examples here, here, and here).  There are many interesting questions around pay-for-performance deals, but LaMattina closes his column with a focus on one: their impact on the direction of pharmaceutical R&D.

Specifically, LaMattina argues: “Biopharmaceutical companies will closely watch how pay-for-performance evolves. Should payers become overly enthralled with rebates and continue to raise the bar, companies could move their R&D efforts into areas where a drug’s impact can be easily defined and measured. In such an environment, therapeutic areas like depression and obesity could give way to diseases like psoriasis or rare diseases where patient advocacy remains strong. In its efforts to rein in costs, payers might unwittingly force R&D out of areas where new drugs are still needed. That would be unfortunate.”

LaMattina is exactly right in one sense – and highly misleading in another.  First, underlying LaMattina’s argument is a critical claim that the way in which drugs are paid for affects the types of drugs that are developed.  This is absolutely right.  Although it may be perfectly obvious to some, as someone who just wrote a 25,000 word article on this very topic (oh hi, SSRN), I can attest that recognition of this idea is too often absent from the legal literature.  We largely focus on prescription drug insurance and payment as a way to encourage access to medications that already exist, but we ignore its effects on the types of drugs that are produced in the first place.

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Healthcare complaints matter: the need to improve the system

By John Tingle

Today consumerism is an essential part of the fabric of British society and complaint systems are heralded in many retail and professional environments. The British public have got used to complaining over the years and this attitude has seeped into the provision of health care services.

Records levels of complaints about the National Health Service (NHS) can be seen to be made every year but the NHS just does not seem to be able to get to grips with developing a good patient complaints handling system.

The Health Service Ombudsman (HSO) lies at the top of the NHS complaints structure and makes the final decisions on complaints that have not be resolved by the NHS in England. The HSO has looked into the quality of NHS complaint investigations where serious or avoidable harm has been alleged.Systemic failings in complaint, patient safety investigations were revealed. Failures which unsurprisingly have appeared in numerous complaints reports over the years before.

For the report, the HSO reviewed 150 NHS complaint investigations where avoidable harm or death was alleged. The HSO also spoke to six different trusts and surveyed over 170 NHS complaint managers to gain insights. An advisory group was later convened by the HSO to test findings.

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TWIHL Special: Wendy Mariner Analyzes the New Wellness Regulations

By Nicolas Terry and Frank Pasquale

twihl 5x5A special TWIHL episode with analysis of the new EEOC regulations under the ADA and GINA on Employer Wellness Plans. Nic is joined by Professor Wendy Mariner. Professor Mariner is the Edward R. Utley Professor of Health Law at Boston University School of Public Health, Professor of Law at Boston University School of Law, Professor at Boston University School of Medicine, and Co-Director of the J.D.-M.P.H. joint degree program, and a member of the faculty of the Center for Health Law, Ethics and Human Rights at BUSPH. Professor Mariner’s research focuses on laws governing health risks, including social and personal responsibility for risk creation, health insurance systems, implementation of the Affordable Care Act, ERISA, health information privacy, and population health policy.

Our discussion concentrated on the ADA regulation and examined how the agency responded to comments (including ours), the concept of voluntariness, the status of EEOC v. Flambeau, Inc., data protection (including issues raised when  employers research the health of their employees), and the policy flaws in the wellness space.The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy.

Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

How Not to Debate Health Care Reform

Editor’s Note: This post was originally published on May 12 with portions of the essay missing. The corrected text is below.

By Ted Marmor

Presidential campaigns in the United States are not typically fought over competing manifestos, with policy details set out in reasonably clear language. Rather they are disputes among candidates about the state of the country and what values—or aspirational visions—they endorse.  And, for at least a century, most American debates about health care reform have been dominated by ideological slogans, misleading claims about financing, and mystifying labels. Republicans have exemplified the mystification this year, repeatedly mislabeling Obamacare as socialized medicine and falsely claiming it a “takeover of American medicine.”

In fairness, the Democratic primaries have generated their own version of mystification. The two candidates do agree on the goals of universal health insurance. But clarity ends there. The Clinton campaign has emphasized incremental reform possibilities and criticized Senator Sanders’ proposal of Medicare for All as unrealistic. Sanders, by contrast, has offered a compelling conception of a fairer and less expensive version of what Americans want, but no incremental steps to get to it.

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Elizabeth Sepper on ‘The Week in Health Law’ Podcast

By Nicolas Terry and Frank Pasquale

 

This week we interviewed Elizabeth Sepper, Associatetwihl 5x5 Professor of Law at Washington University. Elizabeth’s work explores the interaction of morality, professional ethics, and law in health care and insurance. She has written extensively on conscientious refusals to provide reproductive and end-of-life healthcare In recent work, Elizabeth has argued that, in resisting compliance with antidiscrimination laws, pharmacy regulations, and insurance mandates (most prominently, the Affordable Care Act’s contraceptive mandate), businesses make claims more reminiscent of market libertarianism than of religious freedom.

Our conversation covered many aspects of conscience claims by contemporary health providers. Our timing was perfect, since HHS just finalized a rule on one of Elizabeth’s areas of expertise: prohibitions on discrimination based on race, color, national origin, sex, age or disability. Elizabeth weighed in on the rule and its implications for the future of health care.

The Week in Health Law Podcast from Frank Pasquale and Nicolas Terry is a commuting-length discussion about some of the more thorny issues in Health Law & Policy. Subscribe at iTunes, listen at Stitcher RadioTunein and Podbean, or search for The Week in Health Law in your favorite podcast app. Show notes and more are at TWIHL.com. If you have comments, an idea for a show or a topic to discuss you can find us on twitter @nicolasterry @FrankPasquale @WeekInHealthLaw

The Unintended Uninsured: The Affordable Care Act’s Coverage Gap

[Cross posted from the Harvard Law and Policy Review]

By Julian Polaris

This is a golden age for access to healthcare in America. In 2015, over 90% of Americans had health coverage, the highest insurance ratein the 50 years the federal government has collected insurance data. This astonishing progress is due in large part to the Affordable Care Act (ACA): President Obama recently announced that 20 million people are covered thanks to the ACA. The victory is bittersweet, however: had the ACA been implemented as designed, an additional three million people would have insurance today. This is the story of the “coverage gap,” a crack in the ACA created by the Supreme Court and left unrepaired in nineteen states. A crack so wide that three million low-income people have fallen through it.

The ACA, as originally passed, aimed to increase access to health coverage in two main ways. First, the Act expanded Medicaid, the public health plan for people with low income. Previously, most states had limited Medicaid eligibility to specific groups like children and pregnant women. The ACA enlarged and standardized the Medicaid program to cover all people who earn up to 138% of the federal poverty level (FPL). The federal government picks up 90% of the cost of healthcare services for newly eligible beneficiaries, whereas costs in traditional Medicaid are split closer to 50-50.

Second, the ACA established the health insurance “exchanges,” portals in each state where consumers can shop for standardized plans that aren’t tied to a particular employer. Federal tax credits are available to subsidize exchange coverage for those earning 100 to 400% of the FPL. Continue reading

Zubik v. Burwell, Part 3: Birth Control Is Not Abortion

Photo: Plan B

Flickr/Creative Commons—Irina Ivanova

By Gregory M. Lipper

(Read Part 1Part 2Part 4Part 5, and Part 6 of this series)

Pay attention to the Supreme Court’s upcoming contraceptive-coverage cases and you’ll hear horror stories from religious-right groups about an “abortion-pill mandate” (here’s ADF and ACLJ). These groups know that contraception is popular and that, to most people, campaigns to block birth control would seem Jurassic. With abortion more controversial, claims about compulsory distribution of “abortion pills” sound much scarier. Indeed, the plaintiffs’ briefs in Zubik claim that the accommodation would make the plaintiffs complicit in the provision of coverage for, among other things, “abortifacients.”

But neither surgical abortion nor the abortion pill (known as RU–486) are part of the Affordable Care Act’s coverage requirements. So why are courts, websites, and inboxes awash in complaints about the termination of pregnancies?

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Breaking Good? The Arc Of Antitrust Policy In The Health Sector

This new post by Barak Richman appears on the Health Affairs Blog as part of a series stemming from the Fourth Annual Health Law Year in P/Review event held at Harvard Law School on Friday, January 29, 2016.

It appears that 2016 will follow 2015 as another year of massive consolidation in the health care sector. It therefore follows that 2016 will, also like 2015, be another year in which assorted health care industries receive significant antitrust scrutiny. Against this backdrop, it is timely and revealing to examine the current state and trajectory of antitrust law as it intersects and shapes health care policy.

Beginning in the late 1980s, when hospitals and hospital systems started an intense consolidation trend that continues today, many were challenged by the Federal Trade Commission (FTC) for creating anticompetitive and therefore illegal pricing power. Yet the FTC was unsuccessful in convincing courts that this was a harmful trend, and the Commission earned a costly, long losing streak, suffering defeats in each of six landmark cases between 1994 and 1999 (Note 1). The district courts reasoned that the hospitals’ mergers would provide better and more efficient care, that patients would travel to obtain cheaper care, and in any event, because the hospitals were nonprofit, they would not exercise market power to increase prices.

All these predictions have been proven incorrect. Hospital mergers (including those involving nonprofits) have significantly increased prices, and there has been no evidence of increased efficiencies. In fact, evidence suggests that, because the administration of health insurance both reduces the impact of marginal price increases and limits demand in close substitutes, hospital monopolists are even more costly than “typical” monopolies. One significant development in 2015 is new research which revealed that cost variation in the US is largely determined by hospitals market power. The string of FTC losses and the consequent wave of hospital consolidations can only be described as a collective and massive failure of antitrust policy. […]

Read the full post here.

What is the IMD Exclusion that everyone is talking about?

By Emma Sandoe

A less covered provision of Medicaid law that has been in existence since the establishment of the program in 1965 and has been making some news over the past several months, the IMD exclusion is a provision that restricts Medicaid payments for certain institutions, potentially reducing the access to available services for low-income individuals with mental illnesses. If you haven’t been hearing everyone talking about it… well, I guess you talk with fewer health policy nerds than I do.

What is the IMD exclusion?

According to the good people at the National Alliance on Mental Illness (NAMI), the IMD exclusion can be defined as: Institutions for Mental Disease (IMDs) are inpatient facilities of more than 16 beds whose patient roster is more than 51% people with severe mental illness. Federal Medicaid matching payments are prohibited for IMDs with a population between the ages of 22 and 64. IMDs for persons under age 22 or over age 64 are permitted, at state option, to draw federal Medicaid matching funds.

Why does Medicaid have this provision?

This is because when Medicaid first started, states were responsible for the care of people with severe mental illness. States cared for many people with mental illnesses in a custodial setting; essentially states often were providing people a place to sleep but no mental health services. When drafting the Medicaid bill, the federal government did not want to supplant this existing state program with federal Medicaid funding. Additionally, while President Johnson was notorious for not spending a large amount of time on the cost of Medicare, the addition of these services would add $1.8 billion to the Medicaid budget, nearly doubling the first year price tag.

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NHPC 2016: Care Integration as a Potential Alternative to Health Care Consolidation

By Cornelia Hall, Master of Public Policy Candidate, Harvard Kennedy School, Class of 2017

This is the second entry in a three-part series on the AcademyHealth National Health Policy Conference, held in Washington, DC, on February 1-2, 2016. Read the first entry here

Consolidation in the health care sector, particularly among providers and private insurers, has been rising since the Affordable Care Act passed in 2010.  Major movement is currently underway among the “Big Five” private insurance companies: Humana, Cigna, UnitedHealthcare, Aetna, and Anthem.  Two proposed “horizontal” mergers, currently under review by the Department of Justice Antitrust Division, would reduce these “Big Five” to the “Big Three.”  In this context, NHPC panelists discussed private sector consolidation’s potential impact on the cost, quality, and coverage of health care.  Several panelists expressed concern about the effects of consolidation on patients and the costs of services.  They also indicated, however, that the health care system’s ongoing transition to more coordinated care could help to offset potentially negative consequences of consolidation.

As the Justice Department analyzes the proposed mergers, industry analysts on the NHPC panel suggested that insurer consolidation could negatively affect patient experiences in the health care system.  Sarah Lueck of the Center on Budget and Policy Priorities noted that the Affordable Care Act was designed to improve market competition, but the proposed insurance mergers could increase enrollees’ premiums and harm transparency for consumers.  She pointed out that this competition among providers also drives quality of care, which could suffer under consolidation. Continue reading