The ownership of insurers of American primary care practices is small but growing: study

Diving bullets:

• Health insurers regularly broaden their control over the American primary care market – especially in the fields with many seniors eligible for Medicare Advantage, according to new research.
• In 2023, payers’ operated practices represented 4.2% of the National Medicare Primary Care Market per volume of services, against 0.8% in 2016, revealed the study published in Health Affairs Scholar. This is the first concrete estimate of the ownership of the insurers of doctors nationwide, and suggests that vertical consolidation is motivated by the potential for the profits of MA members at possessed clinics, researchers said.
• The document could also intensify the microscope on unitedhealth while legislators and regulators examine the health care giant huge control over industry. Optum, belonging to Unitedhealth, was the largest operator of primary care clinics of all insurers included in the analysis, holding more than 2.7% of the market share nationwide and more than 35% in several major counties.

Diving insight:

Health insurers have gradually developed doctors’ offices despite the growing concerns of supplier groups, patient defenders and certain legislators.

Payers say that possession of medical offices allows them to better coordinate care for their members, especially in value -based arrangements, improvement of the results and patients in media at lower cost.

But critics fear that vertical integration can allow insurers to direct patients to their own doctors to the detriment of other practitioners, to disadvantage rival insurers by closing internal suppliers from their networks and allowing other anti -competitive behavior, which potentially causes higher prices and less choice for patients.

The concerns about vertical consolidation have made snowball in recent years when the main payers have increased mergers and acquisitions to catch up with Optum, which launched the trend of vertical integration more than a decade.

Last spring, Andrew Witty, CEO of the Hunitealth Unit, said that Optum had grown up to employ “just under 10,000 doctors – around 1% of all doctors in the United States – and be affiliated with 80,000.

But the peers of Unitedhealth, notably Humana, Elevance and CVS of CVS, have also increased their scope, but large -scale mergers and acquisitions, silent acquisitions of autonomous practices and organic expansion.

Out of the more than 381,000 primary care physicians, billing Medicare in 2023, 6.4% worked for a practice operated by payers, according to the new study by researchers with the Brookings Institution for non -profit and the Cornell Medical College Policy Center.

Compared to hospitals, which has more than third party of all the country’s doctor’s offices, it is a relatively low part. But this could be a slight underestimation based on the way researchers have defined the property, according to Loren Adler, associate director of the center on the health policy of the Brookings Institution and author of the study.

And payers controlling more than 4.2% of health insurance The primary care market is always a “fairly healthy number” which “increases fairly quickly,” said Adler.

“If it stopped completely now, it may be so much story, but if it continues to develop as it has been, I think it becomes a great story,” he added. “The fact that it is only 4% – it means that the general effects and at the system scale are probably smaller than some people have thought, at least so far. There are only many of the market. But that is said, they are large in certain areas.”

Insurers’ control is much more concentrated in certain counties: overall, more than 15% of the American population lived in counties where payers owned more than 10% of the primary care market in 2023, revealed that the study.

More than 10% lived in the counties where Optum alone exceeded this threshold.

And there are pronounced aberrant values. In 2023, Optum controlled almost 45% of the primary care market in the County of Snohomish, Washington; More than 40% in the County Costa, California; And almost 36% in Clark County, Nevada, according to research.

In particular, payers were much more likely to have primary care practices in areas where I was more widespread. Clinics belonging to payers have also provided a considerably greater share of primary care services in my compared to traditional health insurance, the study revealed.

This suggests that payers can be pushed to buy doctor practices due to the possibility of expanding profits in private medication plans, which tend to be more lucrative than other types of insurance, said Adler.

The calculation goes like that.

By increasing members’ access to primary care providers and by triggering less good health results (and higher medical costs), MA insurers can maintain a larger share of bonuses as a profit. AM insurers can also rely on internal doctors to diagnose their members of MA with more conditions to inflate their reimbursement from the federal government, a very uncomfortable practice called high -end.

According to Adler, the temptation to increase high -end coding could mitigate insurers to extend their medical networks.

“It seems to be a story of Medicare Advantage,” said Adler. “Admittedly, we already have a good amount of evidence that paid payers vertically tend to be able to code their registered more intensely and are able to make their registered Having looked sick … and the way you pay, you are paid more money, plus the patients of your patients. »»

The increase in high -end coding evidence has fueled calls for control reform, especially since the program is developing. MA inflated to cover 33 million people, more than half of all the elderly in the coverage of Medicare.

Growth has exacerbated concerns about the budgetary integrity of Medicare. The CSMPAC Congress Congress Congress considers that CMS will pay the insurers of my 84 billion dollars more this year than the government would have done if these members had been in traditional health insurance. Upcoding was responsible for almost half of these overpayments.

Biden and Trump’s administrations have taken measures to repress coding, while bipartite members of the congress expressed their interest in pursuing legislation to prevent program profits. The bill on the domestic policy of the Republicans was considered a vehicle to potentially adopt such a reform, but the final version adopted by President Donald Trump on July 4 included no border of bad behavior in MA.

Adler said it was worth the Congress to limit MA’s overpayments, but that the complexity of the problem could continue to take Ischioshios of the development of significant Washington policies.

“We know in a way what [insurers are] Take advantage of. And insofar as you can continue this, or even in a way to limit the overpayments, which removes at least some of the low fruits here and probably the right size or in a way the desire to compile a ton of practices under the policies of an insurer, “said Adler. They are simply political.