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Hospital Federation: No Link Between Consolidation, High Prices

John Commins, for HealthLeaders Media, January 28, 2014

"Yet, in terms of prices for consumers, this study's extensive review of the literature finds no consistent statistical relationship between consolidation patterns and hospital prices across the studies. What also can get lost is that these claims about hospital merger effects often rely on outdated data that do not reflect today's dynamic market conditions."

Instead, the FAH report says consolidation improves services and care coordination, and ensures continued access to care that is not disrupted by financial straits that threaten to shutter hospitals that go it alone.

Also not surprisingly, America's Health Insurance Plans begs to differ.

"The evidence shows that increasing provider consolidations results in higher prices for consumers," says AHIP spokeswoman Clare Krusing. "The rhetoric about provider consolidation is that there is greater efficiency, but there is government data and research that shows the reality is higher prices for consumers. The rhetoric is efficiencies but the reality is higher prices."

"AHIP is missing the point," Kahn said. "You have to look at the big picture. All they are focusing on is simply their payment for the covered lives in their insurance book's business. They are not really concerned, I don't think, about the access of those people to hospital care," he added.

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