NEW YORK ( MainStreet) — Large insurance companies have successfully changed the conversation in healthcare. The discussion now circles around medical charges instead of being aimed back at the carriers. However, few articles delve into how health insurance companies squeeze smaller medical practices to the point of nearly shutting them down as they participate in the robust insurance networks. As a result, the dream of opening a private practice for many young graduates is out of reach.

Practitioners currently in private practice have options with insurance companies: accept an extremely low rate of pay and be in-network or throw some of the costs on to the patient and get reimbursed fairly out-of-network. It is common for a doctor's office to go 10 to 20 years without seeing a raise of any kind while the business needs to keep up with rising costs and the rate of inflation. If this is happening everywhere, the posed question is: why exactly is that?

"Some insurance officials acknowledge they have reduced payments to providers in some plans, saying they are under enormous pressure to keep premiums affordable," said John DiVito, president of Flexible Benefit, a private insurance exchange.

Insurance companies have to cut costs somewhere. Now that might not make sense if you are a customer holding your insurance card in your hand. But here's the rub.

"Insurance companies are in the business of managing risk," DiVito said. "It can be easier to manage risk with a larger business, because they have more employees to reduce the actuarial risk. It can be more challenging to manage risk with smaller businesses, because there are fewer employees to reduce the actuarial risk, but these factors are taken into consideration when an insurance company sets their rates."

So, what is actuarial risk? It is insurance risk. It is the variables that, for example, calculate the frequency of losses.

"Larger businesses with more than 25,000 employees always are easier to deal with on that score and always will be reasonable for insurance companies to deal with," said James Burgess, a Boston University professor who teaches health policy and management. He further noted that once you go to the great preponderance of the insurance business below 25,000 employees, things get very complicated."

Then comes the issue that there is a sea of physicians out of there who have not gotten an in-network raise from an insurance company since the 1990s or whenever they signed their contract. This is a pretty common story.

"Money is going toward more care by more specialists," Burgess said. In the U.S., one-third of physicians are in primary care, two-thirds are specialists; in the rest of the world, it's the inverse.

Money in the system moves upward to more complex work, visits and procedures to more specialists.