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Nonprofit health system deals in poor areas scrutinized by WSJ

The Wall Street Journal is monitoring nonprofit health systems and recently published an article scrutinizing where the largest systems are expanding and contracting.

The publication examined 470 hospital transactions for trends and concluded systems were more likely to shed hospitals in low-income communities than add them. The Journal specifically examined 11 largest health systems by number of hospitals as of November.

"As these systems grew, many were more likely to divest or close hospitals in low-income communities than add them. …At the same time, many top nonprofits were moving more aggressively to add hospitals in more affluent areas," the report concluded.

The report also noted many transactions strengthened the systems' finances and increased cash reserves. The consolidations also gave hospitals more leverage in payer negotiations, and divesting or closing hospitals in low-income markets boosted overall finances, according to the report.


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