This Health Affairs article by Bob Berenson and co-authors applies scrutiny to the market power that some health care providers, particularly dominant hospital systems, wield to negotiate higher payment rates from insurers. Based on interviews in 12 U.S. communities, they find that so-called "must-have" hospital systems and physician groups are obtaining steep payment rates from insurers. Even in markets with dominant health plans, insurers have not been aggressive in constraining rate increases, perhaps because they can simply pass along costs to employers; the dominant insurers only need to get the most favorable rates, not low rates. These findings suggest a range of market and regulatory approaches should be examined to address growing provider market clout.
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