Monopoly, monopsony, and market definition: An antitrust perspective on market concentration among health insurers

David A. Hyman, William E. Kovacic

Research output: Contribution to journalReview articlepeer-review

Abstract

James Robinson uses the Herfindahl-Hirschman Index (HHI) to compute the concentration of commercial health insurance markets in most of the states during the past four years. The HHI is the analytical foundation for the federal antitrust merger guidelines, so we consider his findings from an antitrust perspective. Market concentration provides an important benchmark for antitrust analysis, but it does not, standing alone, indicate the presence of problematic (anticompetitive) behavior or a problem that antitrust law can solve. Even if it did, there are major problems in treating individual states as discrete insurance markets. Unless the market is correctly defined, any analysis of market concentration is thoroughly unreliable.

Original languageEnglish (US)
Pages (from-to)25-28
Number of pages4
JournalHealth Affairs
Volume23
Issue number6
DOIs
StatePublished - Nov 2004

ASJC Scopus subject areas

  • Health Policy

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