Loss of Competition Is Seen in Health Insurance Industry

By ROBERT PEAR

Published: April 30, 2006

WASHINGTON, April 29 — Federal investigators have found that a handful of companies account for a growing share of the health insurance policies sold to small businesses in most states, leaving consumers with fewer options and higher costs.

The Government Accountability Office, an investigative arm of Congress, said that the largest insurer had 43 percent of the market for small group coverage in a typical state, up from 33 percent in 2002. In nine states, the largest carrier — a Blue Cross and Blue Shield company — has more than 50 percent.