Patients expect their physicians to recommend treatments based on medical evidence. But a growing body of university research suggests that the company covering the insurance may also employ the doctor diagnosing and treating the patient’s conditions.
Five of the largest health insurance companies in the United States now operate networks of physician practices, pharmacy benefit managers, and ambulatory surgery centers.
Those five insurers collectively cover about 126 million Americans and control 69% of all Medicare Advantage enrollment, a Brookings Institution analysis found.
For the millions of people comparing plans during the next open enrollment window, the financial relationship between insurers and physicians is invisible, yet consequential.
New data from Brown University and Brookings show that when insurers buy doctor practices, spending climbs.
UnitedHealth’s Optum acquisitions added $250 million in annual Medicare spending
A working paper from Brown University’s Center for Advancing Health Policy through Research measured what happened after UnitedHealth Group purchased physician practices through Optum.
The research team tracked more than 200 acquired practices and followed about 4,500 primary care providers alongside more than 500,000 Medicare patients.
Medicare Advantage payments tied to those practices rose by roughly $250 million per year after the acquisitions, the Brown researchers concluded.
That increase in spending produced no measurable improvement in patient care quality. Patients at the acquired practices were no less likely to be hospitalized or visit the emergency room, two standard measures used to evaluate clinical performance.
“The rise of insurers, particularly UnitedHealth, acquiring physician practices is one of the most notable recent trends in health care consolidation,” said Jeffrey Marr, Brown’s assistant professor of health services, policy, and practice.
Marr added that regulators including the Department of Justice and Congress have scrutinized the practice, yet little empirical evidence exists to show whether the deals benefit patients.
Acquired practices listed more diagnoses without treating sicker patients
After UnitedHealth completed the acquisitions, physicians at the purchased practices began documenting more medical conditions per patient during routine visits.
That pattern made patients appear sicker in billing records, according to a press release on the Brown working paper.
In Medicare Advantage, insurers receive larger federal payments for patients documented with more serious or numerous conditions.
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“It’s primarily known as a way of gaming the system,” said Christopher Whaley, associate director of the Center for Advancing Health Policy through Research, in the press release.
“The main point of this gaming is that it substantially increases payment to insurers, in this case, UnitedHealthcare, even though the patient’s true conditions remain the same,” he said.
Medicare Advantage now covers more than half of all Medicare beneficiaries, and federal payments to Medicare Advantage plans reached $534 billion in 2025, according to the Medicare Trustees Report.
In 2022 alone, the acquired practices generated about $265 million in additional Medicare Advantage payments tied to the diagnostic coding changes.
UnitedHealthcare paid Optum doctors up to 61% more in concentrated markets
A study published in Health Affairs by researchers at Brown and the University of California at Berkeley examined how UnitedHealthcare compensates physicians.
Using newly available federal price transparency data, the team found that UnitedHealthcare pays Optum doctors about 17% more than independent practices for identical services.
In markets where UnitedHealthcare controls a large share of the insurance business, that payment difference widened to as much as 61%, the study found.
Daniel Arnold, the study’s lead author and a senior research scientist at Brown’s School of Public Health, said in a Brown release that the payment pattern only makes financial sense once the corporate structure is factored in.
<strong>What we saw in the data was that UnitedHealthcare is paying its doctor practices at Optum well above the market rate. Normally, an insurance company wouldn’t pay above market rate because it costs them money, but here it’s not really a cost.</strong>
Federal law requires insurers to spend between 80% and 85% of collected premiums on medical care, depending on market segment, under a rule known as the Medical Loss Ratio. Medicare Advantage plans, the focus of the Brown research, are subject to the 85% threshold.
By directing higher payments to their physician networks, insurers can meet the Medical Loss Ratio threshold on paper without reducing overall corporate revenue.
Nearly 80% of U.S. physicians now work for corporate owners, and Congress is responding
That financial architecture gives insurers a structural reason to continue acquiring physician practices, and the ownership shift is already well advanced.
By 2024, nearly 80% of physicians in the United States were employed by hospitals or corporate entities, up from 62% just five years earlier.
Georgetown University’s Center on Health Insurance Reforms published those figures in a May 2026 analysis of the effects of vertical integration on consumers and clinicians.
Three federal bills have been introduced to strengthen antitrust enforcement against integrated insurer-provider organizations, according to Georgetown.
Only one, the Break Up Big Medicine Act, introduced by Senator Elizabeth Warren (D-Mass.) with Senator Josh Hawley (R-Mo.) as co-sponsor, is bipartisan. That legislation would ban common ownership between insurers and physician practices.
The other two, the Patients Over Profits Act and the Competition and Antitrust Law Enforcement Reform Act, are sponsored exclusively by Democrats.
Brookings traces the money inside each insurer’s corporate tree
Richard Frank, director of the Center on Health Policy at Brookings, and senior research assistant Samuel Peterson mapped the subsidiary networks and traced intercompany revenue flows.
UnitedHealth Group lists more than 2,000 subsidiaries, according to Brookings. In 2025, related entities paid Optum Health $63.6 billion, 63% of that division’s total revenue.
The other major insurers follow similar playbooks:
- CVS routes Aetna premiums through Caremark and Oak Street Health.
- Elevance channels payments through CarelonRx.
- Humana directs spending through CenterWell Senior Primary Care.
Standard plan documents do not disclose whether a Medicare Advantage plan’s insurer, physician network, and pharmacy benefit manager share one corporate parent.
What the Brookings subsidiary map means for plan shoppers
Georgetown’s Center on Health Insurance Reforms has called for greater transparency around ownership and affiliations in healthcare, research that can help enrollees determine whether their plan’s insurer also owns their primary care provider.
Brown’s research shows the financial consequences of that structure: increasing what taxpayers spend on Medicare Advantage while patient hospitalization and emergency room visit rates remain unchanged.
The Brookings subsidiary spreadsheet is the first publicly available dataset to trace those connections, and enrollees approaching the next open enrollment window can cross-reference their plan’s parent company against it before selecting or renewing coverage.
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