Mergers and acquisitions involving hospitals and different well being care suppliers are drawing consideration from federal and state regulators, together with the Federal Commerce Fee, and policymakers amid issues that such consolidations can scale back competitors and contribute to the excessive prices of well being care.
A brand new KFF temporary examines and summarizes the proof about consolidation amongst well being care suppliers as extra group hospitals change into half of a bigger system, and extra physicians are in practices owned by hospitals and methods.
Drawing from all kinds of sources, the temporary gives insights into the tempo of consolidation amongst suppliers, its affect on costs and high quality, and coverage proposals aimed toward decreasing consolidation and growing competitors, similar to:
- Following a wave of consolidation within the early- and mid-Nineties, there have been 1,573 hospital mergers from 1998 to 2017 and one other 428 hospital and well being system mergers introduced from 2018 to 2023.
- The share of physicians working for a hospital or in a apply owned not less than partially by a hospital or well being system elevated from 29% in 2012 to 41% in 2022. As well as, a rising share of doctor practices are owned by different company entities, together with insurance coverage corporations.
- Whereas consolidation could permit suppliers to function extra effectively, a considerable physique of analysis exhibits that it typically results in larger well being care costs. The proof total doesn’t present clear good points in entry or high quality.
- Some research have discovered that hospital consolidation can result in decrease wages for some expert employees, similar to nurses. The broader proof on employment and compensation results is proscribed, together with the extent to which mergers that stop closures may protect jobs.
- State and federal coverage proposals to deal with consolidation and improve competitors embrace strengthening antitrust enforcement, decreasing monetary incentives for supplier consolidation, growing worth transparency, and permitting extra suppliers to enter the market. Every of those proposals would contain tradeoffs, and the extent to which they will scale back well being prices is unclear since many markets already are extremely concentrated.
The temporary is a part of KFF’s increasing work inspecting the enterprise practices of hospitals and different suppliers, and their affect on prices and affordability.