Many of the nation's health care markets are dominated by a single insurance company, according to a new study by the American Medical Association.
The study found that a single insurer had 25 percent or more of the combined HMO/PPO market in the 96 percent of 295 metropolitan areas. In 57 percent of these markets, a single insurer had a market share of 45 percent or even greater.
Between 1994 and 2005, there were more than 450 mergers in the health insurance and also managed care industry.
"The remarkable reduction in the number of competing health plans is troubling for doctors and patients, as competition drives innovation and efficiency in the health care system," says Dr. J. James Rohack, an AMA board member. "Health insurers are posting historically high profit margins, yet patient health insurance premiums continue to rise without an expansion of benefits."
Rohack also said federal regulators "need to take a hard look" at the decline of competition in the health insurance market.
Health insurers say rising drug and hospital costs and at America's aging population are driving up health insurance premiums.
"It's not lack of competition," says Susan Pisano, vice president of communications for America's Health Insurance Plans. "In fact, we have a very, very highly competitive marketplace. Our members compete like mad. In most markets, there are a variety of plans and products to choose from."
Competition among health insurers actually has mitigated the growth of health care costs, she added.