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The health care industry continues to undergo unprecedented consolidation. Health care providers and payors alike have pursued a wide variety of integrative strategies to achieve efficiencies or other business advantages. The Health Care Mergers and Acquisitions Handbook is designed to educate the practitioner about the antitrust analysis of mergers and acquisitions within the health care industry. Over the past two decades there has been an extraordinary amount of litigation related to challenges of hospital mergers. Each chapter identifies and analyzes important antitrust issues governing such consolidations. Accordingly, the first several chapters are devoted to a detailed treatment of substantive issues peculiar to such mergers: an introduction to hospital merger litigation, describing trends in litigation and the way in which such mergers are analyzed; issues unique to market definition, including product market definition and geographic market definition; the competitive effects of hospital mergers, assessing the evidence necessary to establish a prima facie case in a merger challenge and the rebuttal arguments offered by merging parties; a unique rebuttal argument offered by merging hospitals that is treated separately due to its prominent role in hospital merger litigation - the role and significance of efficiencies in determining the competitive merits of such mergers; the potential applicability of the state action doctrine to hospital mergers. In addition to a substantive treatment of hospital mergers, the Handbook also addresses; combinations of health care management organizations (HMOs) and physician practice groups; the analysis used by the enforcement agencies when reviewing mergers of HMOs; antitrust issues posed by physician practice consolidations. The appendix contains a chart summarizing litigated hospital mergers.--
• The U.S. health care system is based on markets. The system will work only as well as the markets that underpin it.• These markets do not function as well as they could, or should. Prices are high and rising, there are incomprehensible and egregious pricing practices, quality is sub-optimal, and the sector is sluggish and unresponsive, in contrast to the innovation and dynamism which characterize much of the rest of our economy.• Lack of competition has a lot to do with these problems.• There has been a great deal of consolidation in health care. There have been 1,519 hospital mergers in the past twenty years, with 680 since 2010. The result is that many local areas are now dominated by one large, powerful health system, e.g., Boston (Partners), Pittsburgh (UPMC), and San Francisco (Sutter).• Insurance markets are also highly consolidated. The two largest insurers have 70 percent of the market or more in one-half of all local insurance markets.• Physician services markets have also become increasingly more concentrated. Two-thirds of specialist physician markets are highly concentrated, and 29 percent for primary care physicians. There have been a very large number of acquisitions of physician practices by hospitals, so much so that 33 percent of all physicians, and 44 percent of primary physicians are now employed by hospitals.• Extensive research evidence shows that consolidation between close competitors leads to substantial price increases for hospitals, insurers, and physicians, without offsetting gains in improved quality or enhanced efficiency. Further, recent evidence shows that mergers between hospitals not in the same geographic area can also lead to increases in price. Just as seriously, if not more, evidence shows that patient quality of care suffers from lack of competition.• This is causing serious harm to patients and to the health care system as a whole.• Policies are needed to support and promote competition in health care markets. This includes policies to strengthen choice and competition, and ending distortions that unintentionally incentivize consolidation.• These include:- Focus and strengthen antitrust enforcement.- End policies that unintentionally incentivize consolidation.- End policies that hamper new competitors and impede competition.- Promote transparency, so employers, policymakers, and consumers have access to information about health care costs and quality.
"Nurses play a vital role in improving the safety and quality of patient car -- not only in the hospital or ambulatory treatment facility, but also of community-based care and the care performed by family members. Nurses need know what proven techniques and interventions they can use to enhance patient outcomes. To address this need, the Agency for Healthcare Research and Quality (AHRQ), with additional funding from the Robert Wood Johnson Foundation, has prepared this comprehensive, 1,400-page, handbook for nurses on patient safety and quality -- Patient Safety and Quality: An Evidence-Based Handbook for Nurses. (AHRQ Publication No. 08-0043)." - online AHRQ blurb, http://www.ahrq.gov/qual/nurseshdbk/
This consummated merger combined two hospitals located close together in the Oakland-Berkeley region of the San Francisco Bay Area. The greater metropolitan area contained many other hospitals that offered a similar range of services, but which were located farther away. A central issue raised by the Sutter-Summit transaction was whether travel costs were low enough such that these hospitals were a sufficient constraint on the merging parties to prevent an anticompetitive price increase. We use detailed claims data from three large health insurers to compare the post-merger price change for the merging parties to the price change for a set of control group hospitals. Our results show that Summit's price increase was among the largest of any comparable hospital in California, indicating this transaction may have been anticompetitive.
This paper examines if hospitals use consolidation to increase their market power and charge higher prices. Several different types of consolidation are examined at the aggregate hospital level as well as at two alternative service category levels - major diagnostic category (MDC) and diagnostic related group (DRG). Hospital-level analysis finds no evidence that consolidating hospitals charge more after merger than non-consolidating hospitals. Micro-level analyses indicate that hospitals that are part of a system that acquire other hospitals charge less than other hospitals after consolidation. Similar trend is found from mergers of independent hospitals within the same market area. MDC-level also indicates price of care goes up in a system hospital after it has been taken over by another system.