Study Quantifies Hidden Pattern in Hospital-Insurer Network Standoffs

Public fights between hospitals and insurers over network contracts are not random. They follow a pattern tied to market share, ownership structure and financial cushion, according to a new analysis published in Health Affairs.

The study, led by Jason Buxbaum, an assistant professor in Brown University's Department of Health Services, Policy and Practice, examined network negotiations with contracts ending between August 2021 and July 2025. Researchers tracked nearly 15,000 relationships between 3,772 hospitals and 92 commercial health insurers. Within that sample, 1,249 cases involved a public threat to end a contract, a tactic the authors call brinkmanship.

That works out to roughly 8% of all relationships studied. Of those threats, 28% ultimately resulted in an actual network exit, meaning about 2% of the full sample ended in a real break. Buxbaum's team noted these rates run higher than figures typically cited in industry reports.

The researchers used natural language processing to scan more than 1,300 indexed news sources, then layered in government and market data to pin down division-level payer details and characterize hospitals financially. That methodology lets them move past anecdote and into pattern recognition, which is where the real finding emerges.

The Goldilocks Zone

Brinkmanship was most common in a specific band of market power, not at the extremes. Hospitals with 25% to 45% of local inpatient capacity and payers with 30% to 45% of commercial membership were the most likely to go public with contract threats.

The logic cuts both ways. A hospital or insurer with dominant market share risks real financial damage if it cuts off a large pool of patients or members. One with minimal market presence faces reputational costs that outweigh the limited dollars at stake. Sitting in the middle, apparently, is where leverage and risk tolerance align just enough to make a public threat worth the gamble.

Other characteristics tracked closely with brinkmanship. For-profit hospitals threatened to exit networks more often than nonprofits. So did hospitals running positive operating margins and those sitting on median or below cash reserves, a combination suggesting operational pressure rather than desperation drives the tactic. Hospitals in metro areas were more likely to go public than their rural counterparts, and threats were more frequent when a national payer sat across the table or when a hospital had already locked in higher rates under its prior contract.

Timing matters too. Most brinkmanship events in the sample occurred in its later years, overlapping with the rollout of public price transparency requirements. The researchers were careful to note their study was not built to isolate causation on this point, but they flagged several plausible contributors: the expiration of pandemic-era financial supports, the accumulated weight of labor and operating costs that built up during the public health emergency, and what they termed "reduced anticipated negative publicity."

That last factor deserves attention. If hospitals and insurers increasingly calculate that going public carries less reputational risk than it once did, brinkmanship could become a more routine negotiating lever rather than a last resort.

Buxbaum framed the broader stakes plainly. News stories about contract disputes and network exits show up regularly in local media, he said in a release from Brown, but typically stay contained to the affected region. "When you gather all these isolated disputes, add them together and quantify how often these tactics are deployed, it's clear that there's a real national issue," he said. "Patients and families are regularly caught in the middle as hospitals and insurers negotiate better deals for themselves."

That middle position is not purely theoretical. Recent disputes, including one between Anthem and Mount Sinai that was eventually resolved with restored in-network coverage, illustrate how these standoffs play out publicly before reaching settlement. Other cases have drawn national press, including a Wall Street Journal report on patients threatened with losing their doctors and local coverage of a North Carolina cancer patient forced into a difficult care decision amid a UnitedHealthcare and UNC Health dispute.

Existing protections offer only partial cover. The No Surprises Act of 2021 provides a 90-day transitional coverage period for patients caught in a network gap, and some states have continuity-of-care laws that extend similar protections. When hospitals and insurers eventually reach new terms, retroactive coverage for care delivered during the lapse is common. But the researchers were direct about the limits of these safeguards: "coverage lapses have extended past the care continuity period, and uncertainty can lead to distress among the patients involved."

The study's scope was limited to commercial market negotiations, which center primarily on price. Medicare Advantage disputes introduce additional friction points, including care denials and utilization management, that the researchers flagged as ripe for future study. They also called for longitudinal research to track how brinkmanship patterns shift over time, arguing that policymakers need better data to judge whether aggressive negotiating tactics actually control costs or simply shift risk and distress onto patients.

The Bottom Line

This study turns an anecdotal pattern into a measurable one. Roughly 8% of hospital-insurer relationships involve a public threat to break a contract, and about a quarter of those threats become real exits. The Goldilocks zone finding is the most actionable piece here: mid-sized market power, not dominance, correlates with the highest likelihood of brinkmanship.

For investors tracking hospital systems and payers, this is a signal worth watching in markets where neither side holds overwhelming share. For-profit hospitals with thin cash reserves but positive margins look like the most probable actors in these disputes, which has direct implications for contract renewal risk heading into 2026 and beyond. Price transparency rules appear correlated with rising brinkmanship frequency, not reduced it, a dynamic that cuts against the policy's original intent and deserves scrutiny as more data accumulates.