Corporate Camouflage and Consolidation
Colleagues:
What do Lifetime Health, Elevance Health, and Highmark have in common? They are all rebranded BlueCross BlueShield firms, and they are consolidating this year. BCBS is smart to rebrand and hide behind their new corporate “parents,” because doing so makes it harder to recognize the severity of this market concentration.
Of the 13 Metropolitan Statistical Areas (MSAs), BCBS (Elevance, Lifetime, and Highmark) is the largest insurer in 10 MSAs, and second largest in 3 MSAs. In 6 MSAs BCBS brands has >55% of the market share. After this acquisition, the Blue brands will be the largest carrier in 11 of 13 MSAs. As much as we would like to say the Blue brands are different companies, they avoid competing for each other’s territory.
In addition, the CDPHP/Excellus/Univera merger is problematic for physicians. Compared to its competitors, CDPHP has a lower rate of complaints and its preauthorization processes have been less onerous. This characteristic may disappear after the merger. Excellus lost money last year and is under pressure to control costs and raise revenue.
In summary, I am very concerned with the significant potential adverse consequences for patients and employers with consolidation. Fewer health insurance companies will lead to a lack of market competition. This will result in higher premiums, fewer choices, poorer customer service, stifling of medical innovation, and further reduction of patient access to care.
Your MSSNY has produced press releases on this subject and brought our concerns to the attention of the appropriate authorities in Albany. Furthermore, MSSNY has forwarded our concerns to your AMA for further action at the national level.
All the best,
Jerome C. Cohen, MD
MSSNY President
