How Concentrated Is Your HMO Market
How Concentrated Is Your HMO Market?
December 28, 1999
Why the difference between the premium revenue trend in Minnesota and those other states? The level of market concentration may explain part of it. For example, just three HMOs dominate the market for commercial HMO enrollees in Minnesota. None of the other markets shown here approaches that level of concentration. As shown in the next figure, the three largest HMOs in Ohio have less than half of the commercial enrollees. The figure below compares six states on the following question: What percentage of HMO commercial enrollees are covered by the three largest HMOs?
The largest HMOs in Colorado have 64.2 percent of the commercial HMO enrollees. Three years ago, twelve HMOs, including three startups, were competing for employers business in the Denver area. Even after the dust settles on a recent wave of acquisitions, there will still be 10 HMO competitors in that market.