Hospital mergers: Not Good for the System or the Patient

Published in The Systhesis Project published by Robert Wood Johnson Foundation:

Hospital consolidation generally results in higher prices. This is true across geographic markets and different data sources. When hospitals merge in already concentrated markets, the price increase can be dramatic, often exceeding 20 percent.

Hospital competition improves quality of care. This is true under both administered price systems, such as Medicare and the English National Health Service, and market determined pricing such as the private health insurance market. The evidence is more mixed from studies of market determined systems, however.

Physician-hospital consolidation has not led to either improved quality or reduced costs. Studies find that consolidation was primarily for the purpose of enhanced bargaining power with payers, and hence did not lead to true integration. Consolidation without integration does not lead to enhanced performance.

Medicynical Note:  So consolidation costs more and doesn’t improve  care.  It also decreases choice, for example as when a religious based “Health”system dominates an area.  Not good. 

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