GAO: Major players dominate private insurance market
A small number of commercial insurers held the lion's share of the individual and group markets in most states in 2013, according to a new Government Accountability Office report (.pdf) prepared for a bipartisan group of lawmakers.
The GAO study analyzed the individual, small-group and large-group markets from 2010 to 2013, before the implementation of Affordable Care Act provisions that could affect competition and market share among insurers. What remains unknown is how healthcare reform will change this overall picture, since it introduced new market variables, including CO-OPs, guaranteed issue requirements and limits on how much insurers can vary premiums.
The GAO's data sources were payer self-reports to the National Association of Insurance Commissioners and the Centers for Medicare & Medicaid Services. The study's overarching theme was that "the biggest gorillas in the U.S. commercial health insurance market got bigger," according to LifeHealthPRO.
Specifically, GAO auditors found that, while several payers were present in every state's individual, small-group and large-group markets in 2013, enrollment clustered among the three largest insurers in most places. These insurers held at least 80 percent of the total membership in at least 37 states.
Moreover, in more than half of these states, one payer had more than 50 percent of the enrollment pie. In five states, there was at least one segment where the largest insurer had at least 90 percent of the total enrollees.
Further, the individual, small-group and large-group markets remained concentrated from 2010 to 2013 in most states, the GAO found. In each market segment, major players had at least 80 percent of the total enrollment in at least 30 states for all four years. The same companies generally held their top positions throughout the study's time period.
A Blue Cross Blue Shield company was the largest insurer in most states in each market segment from 2010 to 2013, the GAO found. Specifically, a Blue plan was consistently the largest insurer in 44 states in the individual market, 38 states in the small group market and 40 states in the large group market.
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