Healthcare's overlooked cost factor

When the Evanston Northwestern Healthcare Corporation merged its two hospitals with the neighboring Highland Park Hospital just north of Chicago 13 years ago, the deal was presented as an opportunity to increase efficiency and improve the quality of patient care. But when the Federal Trade Commission finally decided to look at the deal, it encountered an entirely different objective: to gain market power. Mark Neaman, Evanston's chief executive, had told his board that the deal would "increase our leverage, limited as it might be," the investigation found, and "help our negotiating posture" with managed care organizations.