Market Structure and Hospital-Insurer Bargaining in the Netherlands

Halbersma, Rein; Mikkers, Misja; Motchenkova, Evgenia; Seinen, I.

doi:10.2139/ssrn.963107

Cited by 21 publications

(30 citation statements)

References 42 publications

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“…There have also been few studies of the relationships among the level of concentration in the market of health plans; the level of concentration in the market of hospitals; and the prices that hospital charge. 4,5 This article adds to the literature by studying how both health plan market concentration and hospital market concentration interact to affect hospital prices in the United States. …”

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confidence: 99%

The Increased Concentration Of Health Plan Markets Can Benefit Consumers Through Lower Hospital Prices

Melnick

Shen

2011

Health Affairs

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The long-term trend of consolidation among US health plans has raised providers' concerns that the concentration of health plan markets can depress their prices. Although our study confirmed that, it also revealed a more complex picture. First, we found that 64 percent of hospitals operate in markets where health plans are not very concentrated, and only 7 percent are in markets that are dominated by a few health plans. Second, we found that in most markets, hospital market concentration exceeds health plan concentration. Third, our study confirmed earlier studies showing that greater hospital market concentration leads to higher hospital prices. Fourth, we found that hospital prices in the most concentrated health plan markets are approximately 12 percent lower than in more competitive health plan markets. Overall, our results show that more concentrated health plan markets can counteract the price-increasing effects of concentrated hospital markets, and that-contrary to conventional wisdom-increased health plan concentration benefits consumers through lower hospital prices as long as health plan markets remain competitive. Our findings also suggest that consumers would benefit from policies that maintained competition in hospital markets or that would restore competition to hospital markets that are uncompetitive.A s the long-term trend of consolidation among US health plans continues, providers have voiced growing concern that health plans will acquire such market power that they will be able to depress the prices paid to providers. The American Hospital Association has argued that health plan consolidation leads to "reimbursement to hospitals and physicians that is below competitive levels," thereby threatening both the quality of care and patients' access to it. 1The American Medical Association has proposed legislation that would allow physicians to bargain collectively with health plans without fear of antitrust prosecution, so as to "level the playing field" in price negotiations. 2,3Despite the importance of these issues, and the growing interest in them, there is limited empirical evidence regarding the relationship between concentrated health plan markets-that is, markets where most people with private health insurance purchase it from one to just several insurers-and the prices that plans pay to providers. There have also been few studies of the relationships among the level of concentration in the market of health plans; the level of concentration in the market of hospitals; and the prices that hospital charge. 4,5 This article adds to the literature by studying how both health plan market concentration and hospital market concentration interact to affect hospital prices in the United States.

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confidence: 99%

The Increased Concentration Of Health Plan Markets Can Benefit Consumers Through Lower Hospital Prices

Melnick

Shen

2011

Health Affairs

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“…; Sorensen ; Moriya, Vogt, and Gaynor ; Halbersma et al. ; Melnick, Shen, and Wu ). Within this literature, two recent papers closely relate to this study: Moriya, Vogt, and Gaynor () and Melnick, Shen, and Wu ().…”

Section: Related Literaturementioning

confidence: 99%

Hospital and Health Insurance Markets Concentration and Inpatient Hospital Transaction Prices in the U.S. Health Care Market

Dauda

2017

Health Services Research

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“…We focus on two years: the year before the merger took place (2005) 21 Independent treatment centers are small outpatient treatment centers that are allowed to enter the market since 1998. These independent treatment centers are only allowed to provide elective (no acute) hospital care (Halbersma et al, 2007). 22 We exclude the year in which the merger took place, since we consider this to be a transition year in which the effect of the merger is not yet correctly measurable (see e.g.…”

Section: Datamentioning

confidence: 99%

“…For these markets we calculated the market shares of the hospitals. These resulting market shares are used to calculate the HHI's for each geographical market (see also Halbersma, et al 2007 Havenziekenhuis Rotterdam has a fixed price increase for all insurers of 2.4 per cent, for Erasmus MC Ziekenhuis, the price increase is between 1.7 and 4.6 per cent. The weighted average price increase in the Netherlands is 2.5 per cent, the weighted average price increase for Ziekenhuis Gooi-Noord is 3.6 per cent, for Ziekenhuis Hilversum 7.1 per cent, for Erasmus MC 2.4 per cent and for Havenziekenhuis Rotterdam 3.0 per cent.…”

Section: Independent Treatment Centrementioning

confidence: 99%