The consolidation of players within any given health care sector — insurers, multihospital health systems, or private equity-backed entities — that is done to achieve greater market leverage can significantly affect other sectors, including emergency medicine practices. 

The national conversation about health care consolidation has tended to focus on the practitioners’ side, said Atul Grover, MD, PhD, internal medicine physician, executive director of the Association of American Medical Colleges (AAMC) Research and Action Institute, and lead author of a recent AAMC paper, “Why Market Power Matters,” which details this trend.¹ But while mergers, consolidations, and the resulting decrease in competition have generated a lot of concern among policymakers, Dr. Grover said those involving hospitals and other health care groups shouldn’t necessarily be considered a bad thing, especially in light of the merger mania in other sectors of health care.

“In truth, there has been consolidation in health care for decades, with the bulk of it happening outside the provider realm, especially with insurers,” he noted. This consolidation of insurers suggests that policymakers’ exclusive focus on regulating provider consolidation, but not insurers’, is short-sighted.

The AAMC’s study assessed consolidation state by state, defined by the combined market power of the three largest insurers and three largest health systems in any given state. For example, in North Carolina the three largest health systems — Atrium Health, University of North Carolina Health Care System, and Novant Health — have a combined market share of 49.6 percent of all inpatient hospital discharges, whereas the three largest insurers, Blue Cross Blue Shield of North Carolina, UnitedHealth Group, and Cigna Health Group, together control 95.5 percent of the market share of privately insured patients.

On average across states, the three largest health care systems in a state control 43.1 percent of their state market, compared with 82.2 percent of market share controlled by the three biggest large-group insurers. With this consolidation bulking up insurers, Dr. Grover said, it becomes difficult for health care practitioner groups to negotiate effectively with them. That has played a large role in defining how health systems might try to compete in the marketplace.

Tired of Subsidizing

James Augustine, MD, FACEP, a clinical professor in the department of emergency medicine at Wright State University near Dayton, Ohio, and now a medical director of fire and EMS groups after 40 years as an emergency physician, said that health care billing and payment, especially for emergency medicine, is a complex terrain. Private insurers are growing tired of always subsidizing Medicare and Medicaid, which reimburse below cost, but they want to make sure there will always be a well-staffed emergency department waiting to provide good care in the right setting for their members’ emergency needs.

The No Surprises Act has further affected emergency physician groups because UnitedHealthcare and other payers have called emergency department bills “surprise bills” and refused to pay them, Dr. Augustine said. “Our local EMS service using a helicopter system was getting paid zero by any commercial insurer for taking their critical patients from one hospital to another, so it went bankrupt.”

Indeed, the consolidation of commercial insurers has been as-sociated with lower payments to clinicians, attributable to their relative market share, Dr. Grover said. How can health care teams, including both hospitals and physicians, command adequate market power to negotiate in order to keep pace and maintain their leverage for negotiations with insurers? Health care may need to consolidate in response, or at least collectively bargain.

“I can tell you there are numerous examples of academic medical centers asked by local leaders to acquire community hospitals on the verge of failing,”² Dr. Grover said. Another alternative is to collectively bargain through associations or confederations of practitioners, although he could not offer a relevant recent example in emergency medicine.

Private equity-based aggregations of health care practices have gotten a lot of negative press recently.^3,4 For emergency medicine, this has included recent spectacular fails by private equity or similar companies. Dr. Grover noted, however, that private equity doesn’t have to be all bad and can offer a path to achieving needed consolidation and leverage for physicians. Some private equity acquisitions follow an arbitrage model of quickly selling things off and leaving behind the shell of a company. Others take a longer view, emphasizing quality of care.

How do health care teams make the best choices to ensure their practices survive within the limits of what’s possible? Dr. Grover asked. “How do we make these decisions at a practice level? What are the questions we should be asking? As with any merger or acquisition, you need to ask the tough questions beforehand.”

Unfortunately, this kind of negotiation and advocacy is something few emergency physicians are trained to do. “Can we help inform the emergency medicine community about those questions through bad and good examples of private equity acquisitions?” Dr. Grover asked. Perhaps that is an opportunity for ACEP to help prepare its members for future merger mania.

In any case, he concluded, “we need to look at the whole picture of the health care field and its many interrelationships. Can we talk about what we want that field to look like?”

Insurer Consolidation

Insurer monopolies should be among the most important topics discussed in emergency medicine, Jody Crane, MD, chief medical officer of TeamHealth, argued in a written statement to ACEP Now. TeamHealth is a large physician staffing and outsourcing company, with 14,000 affiliated physicians and advanced practice clinicians, including emergency physicians. “The root of many problems we experience today is insurer consolidation and [the] resulting lack of insurer accountability. The AAMC study shows that the scales are weighted heavily in favor of insurers such that there is little likelihood physicians can match them in any market,” he wrote.

“Today’s health care environment is largely driven by insurer monopolies that foster one-sided, take-it-or-leave-it rate-setting that reduces physician reimbursement. Insurer practices of unilaterally downcoding charges, denying care, and creating opaque payment schemes are harmful to all physicians across the country, especially smaller practices that lack the market leverage and resources necessary to fight back. This issue is especially acute for ACEP members because insurers have little incentive to maintain adequate networks; under EMTALA requirements, their participants always receive care,” Dr. Crane said.

TeamHealth has tried to fight back, including advocacy on many fronts and the successful litigation of unfair payment practices in a lawsuit against UnitedHealthcare following a 2017 mass shooting at a music festival in Las Vegas. On November 29, 2021, a Las Vegas jury found United guilty of “oppression, fraud and malice” for denying ED claims and ordered it to pay $60 million in damages to TeamHealth.⁵

Although we have a long-standing practice of not balance billing patients, we fight underpayments in the No Surprises Act’s Independent Dispute Resolution process … because we believe in fighting for what is fair,” Dr. Crane said, adding that neutral Independent Dispute Resolution arbiters have agreed with TeamHealth more than 90 percent of the time.

Is Bigger Better?

“Private equity is just a player in this game that we’ve created as a society, where everything gets bigger and bigger,” said ACEP’s President L. Anthony Cirillo, MD, FACEP, director of government affairs for the Canton, Ohio-based physician staffing firm US Acute Care Solutions. “The AAMC has put into print what has been the reality for years — even though this can be painful for our physicians to hear — that health care truly is a business. Whether we like it or not, there’s a lot of money involved, 18 or 19 percent of our gross national product.”

As health care has evolved, becoming ever more complex and sophisticated, it has also become more costly, Dr. Cirillo said. “New technologies are costly; new procedures are costly. Then Wall Street woke up to the fact that there’s a lot of money floating around the health care business and decided to get involved.”

Insurance companies consolidated first, then hospitals became health systems, he said. “Last in this triangle is us, the emergency physicians. Now we’re struggling with the need for size in order to be financially successful, which means losing individual control over our working conditions,” Dr. Cirillo said. “I think the discordance that many physicians feel is that if they are part of a big group, they’ve lost their sense of who they are.”

“They don’t feel they have a voice in their working conditions, and that is particularly challenging for emergency physicians because of where they practice,” Dr. Cirillo added.

Dr. Crane suggested that the “horizontal” integration of insurers coming together across large geographic areas and populations is not the only relevant issue affecting emergency physicians. “What is even more concerning is vertical integration — health plans buying and owning physician groups. This has been clearly demonstrated in recent investigations of Optum, wholly owned by UnitedHealthcare, the single largest physician group in the U.S., with over 100,000 clinicians.”

Optum has been accused of upcoding charts and providing false diagnoses in support of higher Medicare Advantage managed care rates,⁶ Dr. Crane noted. “More recently, these investigations have been expanded to include how it reimburses the doctors it owns for the services they provide. These insider reimbursement practices threaten the very viability of practices large and small and tip the scales in favor of payers. We should be very concerned when insurers have control over both the re-imbursement and the medical care decisions of physicians.”

Mr. Beresford is an Oakland, California-based freelance medical journalist. 

References  

1. Grover A, Orgera K, Pincus, L, et al. Why Market Power Matters for Patients, Insurers, and Hospitals. Data Snapshot: Association of American Medical Colleges Research and Action Institute. https://www.aamcresearchinstitute.org/our-work/data-snapshot/why-market-power-matters. Published May 1, 2024. Accessed June 15, 2025.
2. Nguyen T. Academic and Community Health Systems: What Happens When They Merge? Blog post, the Tronvig Group. https://www.tronviggroup.com/academic-and-community-health-systems/. Published September 20, 2024. Accessed September 8, 2025.
3. Maurer M. Doctors Warn Accountants of Private-Equity Drain on Quality: You Could Be Next. The Wall Street Journal. https://www.wsj.com/articles/doctors-warn-accountants-of-private-equity-drain-on-quality-you-could-be-next-1be0f0fd. Published May 7, 2025. Accessed June 15, 2025.
4. Reed T. States try to limit private equity in health care. Axios. https://www.axios.com/2025/03/17/private-equity-health-care-state-legislation. Published March 17, 2025. Accessed June 15, 2025.
5. Pifer R. UnitedHealthcare to appeal after jury awards TeamHealth $60M in damages. Healthcare Dive. https://www.healthcaredive.com/news/nevada-jury-unitedhealthcare-guilty-teamhealth-reimbursement-surprise-billing/610681/. Published November 30, 2021. Accessed September 8, 2025.
6. Tong N. Medicare Advantage fraud in DOJ’s crosshairs after agency reports $2.7B in settlements. Fierce Healthcare. https://www.fiercehealthcare.com/payers/medicare-advantage-fraud-dojs-crosshairs?utm_medium=email&utm_source=nl&utm_campaign=HC-NL-FierceHealthPayer&oly_enc_id=8363J2903223D2C. Published February 23, 2024. Accessed September 8, 2025.