ICYMI: Provider consolidation contributes to rising health insurance premiums in California
Posted by Campaign on February 26, 2010 at 2:37 PM
Respected, independent health care policy experts Robert Berenson, Paul Ginsburg, and Nicole Kemper take a deep dive into the issue of rising health care costs in California. Their report determined that provider consolidation played a larger role than is being discussed in driving health care costs higher. Here are some key excerpts:
- "Growing market power for providers caused a shift that gave providers a stronger bargaining position over health plans, leading in turn to higher insurance premiums."
- "Such provider dominance could offset some or all of the potential of reforms to lower premiums through increased efficiency in delivery."
- "A rapid upward trend began about 1999 that produced average annual increases of 10.6percent over the period 1999-2005."
- "In some cases, payment rates to hospitals and powerful physician groups approach and exceed 200percent of what Medicare pays, with annual negotiated double-digit increases in recent years."
- "Findings from our study of six major California markets are particularly instructive, both because of California's bellwether status and because national health reform proposals encompass features of care as it has been financed, organized, and delivered in much of California."
To read the full report, click here.
BusinessWeek also takes a look at the analysis of provider consolidation and its impact on health care costs in California, finding:
- "California's hospital fees surged 10.6 percent annually from 1999 to 2005, twice the national average, as the state's biggest hospital networks began to demand higher rates from insurance companies, according to the report released today."
- "'Health insurers have been squarely in the crosshairs, blamed for the high cost of private insurance while the role of growing hospital and physician market power has escaped scrutiny,' Robert Berenson, a study co-author and researcher at the Washington-based Center for Studying Health System Change and the Urban Institute, said in a statement. 'Provider power is the elephant in the room that no one wants to talk about.'"
To read the full article, click here.
