Growth of cross-market hospital systems could have anticompetitive effects, study finds

Cross-market hospital systems have been on the rise, potentially decreasing competition between systems, researchers in a Nov. 7 Health Affairs study found. 

Cross-market hospital systems may be more likely to increase prices due to the negotiating power that comes with having the same customers, primarily insurers, researchers said. 

The study used data on community hospitals from the AHA Annual Survey Database for 2009 to 2019. It analyzed hospital systems' commuting zones, focusing on cross-market systems that owned hospitals in multiple commuting zones. 

The percentage of hospitals that are part of a hospital system rose from 58 percent in 2009 to 67 percent in 2019, according to the study. 1,500 hospitals underwent a merger or acquisition between 2010 and 2019, and fifty-five percent were in a different commuting zone than the acquiring hospital or system. 

These deals caused an 54 percent increase in the number of health systems in urban commuting zones that could "potentially exert enhanced cross-market power," according to the study.

The study also found that none of the deals documented during this time were challenged by antitrust enforcers because the entities were not competing in the same product and geographic markets.

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