In recent Meet the press The appearance of Sen. James Lankford (R-Okla.) joins a growing number of Republicans opposing Obamacare. One of his lines of attack: The Affordable Care Act promoted health care consolidation.
“What the Democrats did 15 years ago was they radically changed all of health care in America. They moved all the doctors to hospitals. They changed all the reimbursement programs. They moved everything,” Lankford said Nov. 9.
This is one of a collection of Republican talking points regarding the ACA. regularly repeatedand there's a reason for that.
Democrats have been promised a Senate vote this month on extending expanded ACA subsidies that are set to expire at the end of the year. The debate, however, provided an opportunity for Republicans to revive old criticisms and renew efforts to overhaul or even repeal the ACA. One GOP argument is that the sweeping health care law contributed to industry consolidation, driving up prices and forcing more doctors to sell their practices to hospitals or insurance companies.
But industry experts disagree on how much of this market trend may be related to the law known as Obamacare.
Like everything in health policy, it's complicated.
“Most of us live in a different reality,” said Chip Kahn, president and CEO of the Federation of American Hospitals. which supports extension expanded tax benefits. “Our health care system has many problems, and I can't say that the cost to individuals and taxpayers isn't an issue. But to say that improving coverage for more people has made all of these problems worse is truly an exaggeration.”
What happened to doctors and hospitals?
First, some context. The ACA was passed by Congress in 2010, and most of its major provisions went into effect in 2014.
Many healthcare mergers took place both before and after Obamacare became law, so its effect is difficult to gauge.
From 1998 to 2017—nearly two decades, including the first three years of full implementation of the ACA— 1,573 hospital mergers took place. Between 2018 and 2023, another 428 hospital and health system mergers were announced, according to a report from KFF, a nonprofit health information organization that includes KFF Health News.
“The trend toward consolidation existed before the ACA and has continued” as hospitals and other organizations sought to improve their bargaining power, says Glenn Melnick, who studies hospital economics and is a professor at the University of Southern California School of Public Policy.
The KFF profile did not directly address what role the ACA might have played in such mergers, although others have suggested that its focus on care coordination may have led to some activity.
Hospital groups argue that mergers are needed to strengthen finances and counter growing insurer consolidation, and that they could lead to cost savings. Others disagree, arguing that many studies show price increases after mergers.
Even despite this trend—and despite what Lankford said—not all doctors now work in hospitals.
The percentage of physicians who have sold their practices to hospitals or private equity groups continues to rise, currently only 42%. I work in private practiceAccording to the American Medical Association. That's down from about 60% in 2012, before major provisions of the ACA took effect.
According to the AMA, those who sold practices in the last 10 years most often cited inadequate payment rates as the reason.
Others note that many doctors want to be part of a larger group, with more scheduling flexibility and less paperwork hassle. Other changes, including 2009 changes law known as the HITECH ActDemands for hospitals and physicians to increase their use of electronic health records have increased physicians' desire to sell, Kahn said.
“Today's physicians, with their heavy debt burdens, are no longer eager to engage in the old solo practice,” Kahn said. “This didn’t happen because of the ACA.”
Another key driver of this market trend is market leverage, which was at play anyway, some policy experts say.
Hospitals “gained control over physician groups to negotiate contracts,” Melnick said.
When hospitals meet to negotiate with insurers, “they say, 'We'll get out of your network, and we control 30 percent of the doctors, so they'll get out, too.' It was leverage and it worked,” Melnyk said.
How do insurers fit into the situation?
Like hospitals, some insurers have been active buyers, for example snapping up physician practices. Optum, a unit of UnitedHealth Group, owns or is affiliated with almost 10% of the country's doctors.
The health law “sparked an arms race among insurers and hospitals that became larger and more expensive, leaving patients and small businesses with higher premiums and fewer options,” said Joel White, president of the health law. Council on Affordable Health InsuranceV testimony before a Senate subcommittee in November. The council lists among its priorities such right-wing issues as opposition to government-run health care and support for expanded market competition and health savings accounts.
Again, the issue of insurance is complex.
Quantity insurers filing annual reports with the National Association of Insurance Commissioners fluctuated: for example, 949 in 2015 and 1,155 last year.
But aggregate numbers are only one indicator. A few large insurers control significant market shares. In one recent analysis After analyzing different types of insurance, not just ACA plans, the American Medical Association concluded that most areas are highly concentrated, with about 47% of these markets having a single insurer with a commercial market share of 50% or more.
The AMA says this market power leads to higher insurance premiums and lower payments to physicians.
For marketplaces offering ACA coverage, the number of insurers has also varied over time, typically due to variations expected premiums and regulatory framework, at the time the law was passed, the national average was almost eight, The rate will drop to 5.4 in 2018 but rise to nearly 10 nationally in 2025, according to KFF. Because this is an average, some states, such as Texas, have 15 insurers, while seven states—Alaska, Arkansas, Connecticut, Hawaii, Rhode Island, Vermont, West Virginia—and the District of Columbia have only two.
Raising premiums is also nothing new and is not limited to ACA plans.
In fact, premiums for people who buy their own insurance and for workers who get insurance through an employer almost always increase annually – often higher than inflation levels is a trend that predates the ACA.
Critics of the ACA note that premiums in the individual market were lower before the law took effect. What critics often fail to point out, however, is how different insurance coverage was before the ACA for people in the individual market, which could have made it less expensive. For example, before the law, insurers could deny people with pre-existing conditions, charge women more than men, and set annual or lifetime dollar limits on coverage. After 2014, this was not allowed in ACA plans.
Average premiums for ACA benchmark silver plans They rose from $481 nationally in 2018 to $497 in 2025, according to KFF. The average monthly premium will jump to $625 next year, partly due to insurers' expectations of higher costs and lower enrollment unless Congress extends more generous tax subsidies. These are averages and prices will vary across the country depending on factors such as age, location and household income.
The conservative Paragon Health Institute notes that rising insurance premiums mean larger taxpayer-supported subsidies. Deductibles have also increased, with people on bronze plans, which have the lowest premiums, he faces an average deductible of $7,476 next year, up from $5,113 in 2014.
Cost Consolidation Relationship
Health and Human Services Report 2025released in the final days of the Biden administration found that the trend of high concentration of hospital services in most metropolitan statistical areas began before and continued after the ACA. Prices have also increased. The report, which notes the role of private equity firms in consolidation efforts, also cites research showing that physicians are increasingly merging with each other, hospitals or private equity-backed firms.
This is important because largest share of health care spending goes to the USA hospital care, does not lag behind in terms of medical services.
According to the hospital federation's Kahn, the real reason for the mergers is financial: many hospitals, he says, have had to expand their scope or risk going bankrupt.
“A lot of health economists are my best friends,” Kahn said, “but they have tunnel vision when they look at the health care system.” Hospitals must have sufficient revenue streams to cover the costs of treating patients, he said, and consolidation is their way of responding to “all the burdens, demands and demands” they face.
While there is no doubt that healthcare consolidation has occurred, much of it occurred before the ACA, Melnick said.
“At the end of the day, the ACA market never got big enough to drive overall industry restructuring,” he said. “A lot of what they attribute to the ACA would have happened anyway.”
