The Current Era of Health Care Consolidation

Michael R. Richards and Christopher M. Whaley

Journal of Economic Perspectives, 2026, vol. 40, issue 2, 93-116

Abstract: Consolidation in the last few decades has reshaped the organization and structure of US health care markets, among both providers and insurers. Nearly all US hospital and insurer markets exceed established regulatory thresholds for competitive markets, and over half of physicians are now employed by a hospital or health system, which can increase spending for patients, payers, and taxpayers. Increased supply-side concentration can alter the balance of negotiations between providers and insurers. Prices for patients with commercial insurance are approximately 2.5 times the prices paid by those with public insurance. High and variable prices have minimal link with higher quality, and the United States leads peer nations in health care spending. These dynamics have created ongoing national debates over an "affordability crisis" and generates frustrations with the US health care system. This article discusses sources of rising health care spending and potential policy solutions.

JEL-codes: G22 G34 I11 I13 I18 L13 L22 (search for similar items in EconPapers)
Date: 2026
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DOI: 10.1257/jep.20251472

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