When private practices merge with hospital systems, costs go up
21 hours ago
- #mergers
- #antitrust
- #healthcare
- Private practices are increasingly merging with hospital systems, reducing competition and raising healthcare costs.
- A study by Yale SOM’s Fiona Scott Morton found that hospital-physician mergers increase prices by 3.3% for hospitals and 15.1% for physicians.
- Mergers of complements in healthcare do not improve quality but reduce competition, leading to higher prices.
- Researchers used Medicare data and machine learning to track physician mergers, achieving 97% accuracy.
- Three anticompetitive mechanisms were identified: foreclosure, recapture, and market concentration.
- Regulators are urged to enforce antitrust laws more strictly and require transparency in mergers.