Patient Costs Skyrocket as Hospital Systems Merge
Hospital prices in Indiana increased by 45% between 2008 and 2017, a time of heavy health market consolidation.
Hospital prices are soaring in Indiana with patients paying approximately $2,000-$3,000 more per hospital admission than nearby Wisconsin, Ohio, Michigan and Illinois. A new report shows that between 2008 and 2017, Indiana hospital prices increased by 45%, a rate higher than surrounding areas. During this timeframe, Indiana underwent significant merger activity resulting in consolidation in the hospital, physician and insurance markets. This Indiana study echoes previous studies demonstrating the cost increases as a result of health care consolidation. When hospitals and physician practices merge, it reduces competition, resulting in increased prices for patients, and in some cases even decreases in the quality of care. Evidence counters the commonly accepted theory that mergers improve efficiencies and thereby lower costs.
This is not an issue just in Indiana. Across the nation, health care consolidation has been on the rise for the past two decades, with the impact of the COVID-19 pandemic likely to accelerate mergers. Policy solutions to address the impact of hospital mergers include greater enforcement of antitrust policy state and federal regulators when overseeing health care mergers. Regulators should also prosecute health systems which use anti-competitive contracts with insurance companies, preventing effective price negotiation.
If your community has experienced a health care merger or hospital closure, and you’ve had a negative experience as a result (changes in access to care, patient safety and quality, or higher prices since then) we want to hear from you. Please use this form to share your experience.
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