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Market Power of Doctors, Hospitals Seen in High Coverage Costs

Jan. 20, 2022, 9:56 PM

Market power among doctors and hospitals leads to higher prices for commercial insurers than what Medicare pays, the Congressional Budget Office said Thursday.

“Greater market power among providers consistently leads to prices for commercial insurers that are higher than Medicare FFS’s [fee-for-services’s] prices and that vary more widely, both among and within areas,” the CBO said in a report.

The higher prices paid by commercial insurers are a sore subject for employers, some of whom say providers are taking advantage of a lack of competition. Hospitals and physicians argue that Medicare rates are too low and that ...

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