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New Mergers Creating Huge Healthcare Systems that May Dominate Market

Wednesday, August 14, 2013   (0 Comments)
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Will Giant Healthcare Systems be More Efficient or More Costly?

Hospital systems across the country, influenced by changes in the law, demands for efficiency and desire to increase negotiating clout with insurers, are consolidating and merging with remarkable speed, according to a New York Times story by Julie Creswell and Reed Abelson . The consulting firm Booz & Company estimates that 1,000 of the nation’s approximately 5,000 hospitals will merge in the next five to seven years. A health care research firm reports there were 50 merger deals in 2009, and 105 merger deals in 2012. Many hospitals face declining admissions and all face changes in the way they are paid through the Affordable Care Act and by private insurers. Instead of being rewarded for filling beds and performing more services, the story says, hospitals are becoming responsible for more of their patients' total  care and have incentives to keep patients healthier and out of their facilities. Health insurers worry bigger institutions may make them pay more. The Federal Trade Commission worries giant healthcare corporations may stifle competition and drive up costs. Read the story here.


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