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HL20: Steven Sonenreich—Talking Transparency

Philip Betbeze, for HealthLeaders Media, January 9, 2014

Since that day on the radio, Sonenreich has walked back those provocative comments because he must. Instead of publishing prices for individual procedures, Mount Sinai will instead soon release its "blended rate" so as to avoid technically violating its contracts with commercial insurers. Sonenreich's determination to increase transparency in hospital-insurer contracting is not altogether altruistic. He's hoping the release will show his system as a low-cost, high-quality provider that could benefit local employers who might include Mount Sinai Medical Center in a so-called "narrow network" that would save costs.

He contends that most of the impetus for consolidation taking place in healthcare today is, for the most part, about monopoly power, and not economies of scale and scope that health system leaders tout when seeking approval for a merger. Yet he can't prove it to the general public because insurers insist on making the prices they pay healthcare providers a secret.

"Consolidation, which some would like you to believe is about efficiencies, has instead hurt competition and raised prices," he says. "When we looked at state data of large systems in our marketplace, the reimbursement and pricing they were able to receive from insurance companies was at times 45% higher than all other hospitals in the marketplace and their cost was 25% greater. So all consolidation did was drive up price and cost."

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