(c) 2018 Jon L Gelman, All Rights Reserved.

Tuesday, August 13, 2013

The Trend to Supersize Hospitals

The trickle down effect of the current trend to supersize hospitals through mergers and acquisitions may far reaching unintended consequences on medical costs for employers, insurance companies and injured workers. An consequence of the Affordable Care Act is to encourage hospitals to keep people healthy and avoid hospital admissions.

Hospital have been not only purchasing other hospitals reducing the number of independent hospitals in the US from 5,000 to 1,000, but it has also accelerated the trend for hospitals to purchase lucrative medical practices to earn income from diagnostic tests and to control the flow of hospital admissions.

An unintended consequence of this path may actually increase hospital costs because fewer hospital facilities exist, or the lack of competition may just lead to a universal medical care system. Workers' compensation insurance programs may therefore be required higher fees to hospitals.

"Hospitals across the nation are being swept up in the biggest wave of mergers since the 1990s, a development that is creating giant hospital systems that could one day dominate American health care and drive up costs."

Read the complete article, "New Laws and Rising Costs Create a Surge of Supersizing Hospitals" (NY Times)