It seems that merger mania has taken hold of the health care industry. With talks between Cigna and Express Scripts and CVS Health and Aetna Inc., among others, consolidation has gotten the attention of many stakeholders. While these companies justify their unions by highlighting the efficiencies they will gain and the improvements that employers, other health care purchasers and their covered populations will experience, purchasers should remain skeptical.

Related: How broker consolidation and industry alliances are changing the industry

Mergers and acquisitions in health care have occurred for decades. Provider organizations have been merging with or acquiring others for years, and so have health plans. What feels new lately is consolidation among health care entities with different types of businesses. Unfortunately, the evidence about the impact of past consolidation on purchasers is mixed and should raise questions for purchasers about more recent unions.

Provider consolidation

It would take having one's head in the sand not to know that health care costs have been on the rise. In fact, in 2016, health care spending amounted to $3.3 trillion, representing 17.9 percent of GDP. Driving this growth is an increase in prices, largely due to the market power providers have been able to amass through consolidation, enabling them to demand higher prices from health insurers.

From 1998 to 2015, 1,412 mergers among hospitals occurred. During the same period, hospitals bought independent physician practices. Several studies have found a correlation between higher physician concentration or hospital-physician integration and higher commercial health insurance prices. Furthermore, researchers have discovered a negative association between higher prices and patient experiences with care — the higher the prices, the worse the experience.

Health plan consolidation

To maintain negotiating power with provider conglomerates, health insurers also began to merge. In 2001, more than eight health insurance companies had sizable market share across the U.S. but by 2013, only about four did. In 2015, two massive mergers between health insurance plans were proposed — a union between Aetna and Humana and between Anthem and Cigna — though the Department of Justice blocked the mergers on the grounds that they would violate antitrust laws and lead to higher health care costs for Americans.

While the mergers may have given the resulting health plans more market power, many health care experts expressed concern that any savings they would accrue by gaining negotiating power would transfer into C-suite salaries or administrative expenses and wouldn't be passed onto employer-customers.

Recent mergers and acquisitions

While consolidation among providers and plans continues, health care companies in different lines of business have also begun to propose partnerships. CVS's proposed deal with Aetna has received the most attention. Both companies suggest that their partnership will lead to greater convenience for employers and their covered populations and that it will lower health care prices due to greater leverage in negotiations with drug manufacturers.

Based on previous experience, should we accept their rationale or think critically about whether this is ultimately favorable for purchasers?

If the deal goes through, experts believe patients could end up paying more, not less. A company with such leverage will make it challenging for new organizations offering insurance coverage to enter the market and compete. Furthermore, many employers and other health care purchasers have enjoyed the flexibility of offering medical benefits and pharmaceutical benefits to their members through separate companies. By keeping them separate, they have been able to shop around, gaining leverage as competitors know prospective customers have multiple choices. Without the option to offer these benefits separately, purchasers will have to look for which singular health plan offers the best combination of medical and pharmacy benefit management. This might leave them compromising on one to ensure the other meets their needs.

Experts project that these mergers will lead to more like them, likely further reducing competition in the marketplace. As more retail pharmacies, PBMs, and insurers combine, these conglomerates could make it pricier for employers to shop for and offer medical and pharmacy benefits separately, for example by charging higher fees to accept data from an independent pharmacy benefit manager.

Impact to employers

There will also likely be other types of consolidation leading to similar issues for purchasers. For example, while purchasers can procure telehealth services separately today, allowing them to take advantage of how telehealth may reduce utilization of high-priced health care services such as the emergency room, hospitals and health systems are likely to acquire these vendors' business to create further “stickiness” with their own patients.

If the past is at all telling, further consolidation in the health care industry may portend serious issues regarding health care costs and the quality of health care in the future. While these new relationships may not violate any antitrust laws, they may better serve the interests of the companies amassing market power than those who must pay for and use health care services.

Suzanne F. Delbanco is the executive director of Catalyst for Payment Reform, an independent, non-profit corporation working to catalyze employers, public purchasers, and others to implement strategies that produce higher value health care and improve the functioning of the health care marketplace.