Further, who would provide care for all the newly insured patients? Massachusetts, which has one of the highest rates of physicians per capita, doesn't have enough primary-care docs to meet the demand. So imagine what might happen in Texas, a state with one of the lowest rates of docs per capita and more than 5.5 million uninsured, or 25% of the population.
"It may push providers, hospitals, and the government to start thinking more about efficiency, cost effectiveness, and controlling costs," says Doonan.
What if the FTC Wins a Merger Challenge?
Well, technically it already has. Two, in fact. The agency has to be feeling its oats after winning its most recent challenge against Virginia's Inova Health System and its planned acquisition of Prince William Hospital. And after failing repeatedly to stop what it said were uncompetitive mergers in the 1990s and through 2007, the FTC won a case against Evanston Northwestern Healthcare over its acquisition of Highland Park Hospital.
Still, that victory could be considered pyrrhic, as the merger was allowed to stand provided the combined entity offered separate negotiations with Highland Park over managed care contracts to any payer that wanted it.
The FTC has failed in recent years when hospitals were able to get preliminary injunctions against FTC challenges from district courts, which then allowed mergers to proceed, says Jan Levine, an attorney with Philadelphia's Pepper Hamilton who follows FTC antitrust enforcement.
"They feel they have two wins and that maybe the tide is changing," Levine, who has no direct involvement in either case, says of the FTC.
In the Inova case, the FTC made it clear it was ready to proceed with a full trial in its own backyard, so to speak-with an administrative law judge-which would have further delayed a merger that was already two years in the making. As a result, Prince William Hospital, seeing another two years of expenses and delays, nixed the merger itself.
"Nothing's changed in the rules. The difference in Inova was that the FTC was able to have the issues heard on the administrative level, rather than at a full preliminary hearing in the district court," she says. "This time, they got ready very quickly."
So since the FTC did not "win" the Inova challenge in the courts, the lack of a legal decision in the case could present it with problems in future cases, depending on how merging hospitals go about answering an FTC challenge. But if anything is to be learned from the agency's two recent practical victories, it's probably that hospitals no longer can assume they're facing a toothless organization when they make their merger plans-and that delays can scuttle a merger as easily as a court victory can.
What if Safety-Net Hospitals Start to Fail?
It's already happening, actually. Public hospitals have succumbed in major cities like Los Angeles, Philadelphia, St. Louis, and Washington, DC; other safety-net facilities, like Atlanta's Grady Memorial Hospital, are losing millions of dollars annually.
And it's not just happening in the heart of urban areas. Public hospitals had the largest percentage of closures, mergers, and conversions among general acute-care hospitals between 1996 and 2002 both in cities (16%) and in the suburbs (27%), says Dennis P. Andrulis, PhD, MPH, director of the Center for Health Equality and associate dean of research at Drexel University School of Public Health in Philadelphia. Many people may perceive safety-net institutions as large, urban trauma centers, but there are safety-net hospitals in suburban areas, as well, that are "dropping like flies," says Andrulis, adding that from 1980 to 1996, 46% of suburban public hospitals closed.