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Do Leading Health Insurers’ Market Shares Churn? Some Observational Evidence from U.S. Metropolitan Markets

The Journal of Health Care Finance

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Title Do Leading Health Insurers’ Market Shares Churn? Some Observational Evidence from U.S. Metropolitan Markets
 
Creator Santerre, Rexford E.; Rexford E. Santerre, PhD*
Professor of Finance and Healthcare Management
University of Connecticut
School of Business
Bates, Laurie J.; Laurie J. Bates, PhD
Professor of Economics
Bryant University
 
Description Data from the American Medical Association (AMA) have consistently pointed to MSAs in the United States with highly concentrated health insurance markets as defined by Herfindahl-Hirschman indices (HHI).  This study uses data from the AMA to peel back the layers of the HHI onion and finds evidence of competitive health insurance markets. For example, descriptive statistics show that 30 percent of the largest health insurers lose their top spot after six years. In addition, only 12 percent of the second-largest health insurers remain in the second spot 6 years later with the second-largest health insurer rarely replacing the first. Finally, multiple regression analysis reveals that a Blue Cross Blue Shield affiliation, rather than the leading insurers’ market share or not-for-profit status, enhances the probability of remaining in the top spot six years later. Moreover, the regression findings suggest that a greater market share in the initial period is associated with a higher market share for the top insurer six years later but the effect is relatively small. Consequently, insurance regulators may wish to consider both the HHI and the actual churning of market shares among leading firms when considering the competitive nature of specific health insurance markets. 
 
Publisher Worldwebtalk.com, Inc.
 
Contributor —
 
Date 2015-09-05
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://healthfinancejournal.com/index.php/johcf/article/view/38
 
Source Journal of Health Care Finance; Vol 42, No 1: Summer 2015
 
Language eng
 
Relation http://healthfinancejournal.com/index.php/johcf/article/view/38/40
 
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