Vertical integration can both create efficiencies and harm competition through rival foreclosure. This research paper examines these tensions through one of the most prominent forms of vertical integration in the United States: the acquisition of physician practices by the nation’s largest insurer, UnitedHealth Group. Using a difference-in-differences design and Medicare administrative data, the researchers find minimal changes to acquired practice case mix or care quality, but do find evidence of increased patient risk score coding intensity, which translate into nearly $300 million in annual increased spending.
Read the full article: Research: From Payer to Provider – Impacts of Insurer Vertical Expansion into Physician Services //
Source: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7313835