Expert Voices: Hospital Consolidation: Trends and ConsequencesWilliam B. Vogt, PhD, Senior Economist, RAND Corporation
In this essay, Dr. Vogt reviews the extensive empirical literature examining the impact of hospital mergers and acquisitions. The weight of the evidence indicates that hospital prices increase following hospital consolidation, sometimes by very significant amounts. Modest cost savings can be achieved, especially when physical facilities and clinical services are consolidated, however, these savings have not generally been passed on to payers and consumers. Evidence on quality is mixed, but some studies using Medicare data suggest that hospital consolidation leads to poorer outcomes. Within this context, the Federal Trade Commission and the Department of Justice are now revisiting their long-standing guidelines for horizontal mergers. Developments on this front bear watching.
Other recent Expert Voices essays include:
- Genevieve Kenney, Urban Institute, "Uninsured and Eligible for Public Coverage: Underlying Causes and Policy Solutions" (November 2009)
- Eric Jensen, Consultant, and Lenny Mendonca, McKinsey & Company, "Why America Spends More on Health Care" (November 2009)
- Jonathan Gruber, PhD, Professor of Economics, Massachusetts Institute of Technology, "The Role of Individual Mandates in Health Reform" (January 2009)
- Paul N. Van de Water, PhD, Senior Fellow, Center on Budget and Policy Priorities. "Scoring Health Legislation" (April 2009)
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