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Is hospital consolidation beneficial or harmful for the healthcare industry?

At a Politico briefing yesterday, hospital leaders and industry experts debated whether hospital consolidation is driving up costs and stifling competition or helping hospitals take on the challenges of reform.

Martin Gaynor, PhD, director of the Federal Trade Commission's Bureau of Economics, said that some (although not all) hospital mergers pose a threat to the market-based system that supports the Patient Protection and Affordable Care Act and other reforms, according to a Politico report on the briefing. Barak Richman, PhD, a law professor at Duke University, was also on the anti-consolidation side, saying there is "very little evidence" that consolidation has created efficiencies. Dr. Gaynor agreed that, on average, mergers so far haven't led to more efficient care, according to the report.

On the other side, hospital leaders argued that the PPACA has put pressure on providers to better coordinate care and innovate, driving mergers and acquisitions. Deborah Zastocki — president of Chilton Medical Center in Pompton Plains, N.J., and vice president of  CMC's parent company, Atlantic Health System in Morristown, N.J. — said before Chilton Medical merged recently with Atlantic Health, the hospital was struggling to keep up with EHR requirements, for instance. She said the merger gave the hospital access to the infrastructure needed to enact necessary improvements, according to the report.

Sharis Pozen — a former acting assistant attorney general of the Department of Justice Antitrust Division and current partner at the firm Skadden, Arps, Slate, Meagher & Flom — also spoke out in favor of mergers, saying the "vast majority" aren't anti-competitive.

More articles on hospital mergers:
FTC rejects proposed consent agreement in Phoebe Putney Hospital merger case 
PeaceHealth, Ocean Beach merger agreement delayed  
3 recent hospital transactions and partnerships 

 

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