A government report detailing increased market consolidation has armed the Texas Medical Association with new data to serve physicians in a dramatically changing health care landscape.
The recently released report from the U.S. Government Accountability Office (GAO) noted that “market concentration generally increased from 2011 through 2022, with three or fewer insurers holding at least 80% of the market share for the individual and employer group markets in at least 35 states,” peaking in 2019 and becoming slightly less concentrated by 2022.
The report summary noted that this trend “can result in fewer choices of insurers and higher premiums due to less competition in the market.”
“From the patient standpoint, they have no choice,” said Gary J. Sheppard, MD, chair of TMA’s Council on Socioeconomics. “When an [insurance company] concentrates in an area, the patients lose because they can’t choose between one insurance company and another.”
For 2022, 97% of large-group markets and 90% of small-group markets in Texas were dominated by the top three insurers in their respective classes.
“Research studies have found strong evidence that concentration in health insurance markets is associated with higher consumer premiums,” the report specified. “Higher premiums may result in decreased consumer access to affordable health insurance.”
However, the report cautioned that studies do not clearly establish how concentration impacts consumer access.
“It’s one of the things we need to talk to our patients about,” Dr. Sheppard said. “We don't want patients to have decreased choices, because that can definitely adversely affect them.” Meanwhile, he noted, competition among insurance companies can result in lower rates and better benefits for consumers.
Dr. Sheppard says TMA continues to coordinate closely with American Medical Association on the issue, and the GAO report will inform work that the Council on Socioeconomics is already doing in this sphere.
TMA, invested in reforming insurance practices that adversely affect patient care, recently joined the Texas Coalition for Patients. According to Zeke Silva, MD, chair of TMA’s Council on Legislation, the organization is designed to “bring patient-specific stories to the forefront” on insurance-related issues such as prior authorization reform in the upcoming legislative session.
Read more about TMA’s statewide advocacy efforts, and learn more about opportunities to talk to legislators at 2025’s First Tuesdays at the Capitol events, starting Feb. 4.
Phil West
Associate Editor
(512) 370-1394
phil.west[at]texmed[dot]org
Phil West is a writer and editor whose publications include the Los Angeles Times, Seattle Times, Austin American-Statesman, and San Antonio Express-News. He earned a BA in journalism from the University of Washington and an MFA from the University of Texas at Austin’s James A. Michener Center for Writers. He lives in Austin with his wife, children, and a trio of free-spirited dogs.