Earlier this month, President Biden issued an “Executive Order on Promoting Competition in the U.S. Economy,” which called on the Department of Justice and the FTC to review and revise the merger guidelines for ensure that healthcare players are always forced to compete in the best interests of patients. .
More monitoring of health care consolidation is needed, but frankly, it is too little too late.
Hospital consolidation is not new. Bringing value to healthcare recalls how hospitals had “embarked on massive affiliations and buying frenzy” in the 1990s in order, according to them, to increase productivity as well as profitability. Few of the acquisitions have met their expectations of the buying supplier, and while many have promised the union will cut consumer health costs, the opposite has happened. In a 2010-2013 analysis of 25 metropolitan regions with the highest rates of horizontal consolidations – i.e. consolidations between two hospitals or health systems – the cost of the average hospital stay by private insurance increased in most areas between 11% and 54% in the years that followed.
To some extent, this damage has already been done. Unlike other industries where consumers can say what they spend money on up front, in healthcare consumers have become accustomed to being left in the dark when it comes to assessing. the health services they consume. A fundamental disregard for transparency is the norm, as is a system that has been largely paternalistic and opaque.
It’s only recently – and because the costs have gotten so out of hand – that consumers have started to demand change. Whereas previously they were less inclined to speak out on the issue because “someone else”, that is to say their insurer, was paying, today consumers are not afraid to speak out. ‘send journalists their “surprise” medical bills – the network costs of a network hospital. If it was someone besides a health care provider – a car dealership, TV repairer, internet provider, landscaping company, etc. – consumers would never have accepted these surprise bills as long as they tolerated them in health care.
All this to say that the last decades of consolidation have already hurt consumers. And the problems consumers currently face with high costs and insufficient quality will not be resolved by looking only at future consolidations, or by lengthy legal battles to untie consolidations that have already been approved. There are other, more meaningful ways to improve care by instead allowing market-based competition on two things: costs and quality of health care.
The Trump administration began moving forward on the former via the hospital price transparency rule that went into effect in early 2022. President Biden has wisely said he will support the rule, but there is more to be done here . A starting point would be a more rigorous application than what we have seen from this administration to date. Earlier this year, a systematic survey showed that 65 of the country’s 100 largest hospitals were not complying with the transparency rule.
And once the data is published, the next step would be to make it understandable. Just a few weeks ago, when Bernard J. Wolfson of Kaiser Health News reported on his efforts to buy the prices himself, he concluded:
“After three months of glassy eyes and headaches from banging my head against walls of numbers, I throw in the towel. It was a crazy race. My efforts ultimately only resulted in one helpful tip: don’t try this at home. ”
The Centers for Medicare and Medicaid Services (CMS) recently announced that they would increase fines for systems that violate the hospital price transparency rule – a step in the right direction in transparency. However, to really get to the heart of consumers’ concerns, there must also be a hospital. results transparency rule. Once consumers have an idea of the cost of certain healthcare services, the next logical step is to enable them to understand the level of performance they are getting for the price.
To be clear, however, these results do not depend solely on the performance of the hospital. Equally important is the well-being of patients outside the healthcare system. If consumers in a particular area do not have access to safe shelter, transportation, and / or food, this will impact the outcome data of their local health care providers. An ounce of prevention is better than a cure, and we need to better tackle the social determinants of health and make it easier for consumers to access such support up front.
Insufficient access to behavioral health services will also have an impact. Anxiety, depression, and other behavioral health issues can snowball and spiral out of control if left untreated. And when that happens, interrupted sleep patterns and disrupted eating habits can quickly lead to deterioration in physical well-being.
Giving consumers access to more physical and behavioral health supports – not just the same fundamentally flawed healthcare system – would be a step forward for this country, assuming consumers use those services. As we are now seeing with Covid-19 vaccines, without a clear understanding of the scientific benefits of such interventions, consumers may neglect to act and the health of the population suffers.
Tackling healthcare consolidation is not the only way to increase competition in the healthcare industry, nor is it the most effective. If the goal is to improve care, competition must be for cost and quality – and we must all play our part. If hospitals and health systems choose not to cooperate, non-in-kind competitors will continue to cut corners on their losing business.