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Feds keep trying to lower hospital-merger wave



The Federal Trade Commission plans to block the combination of two large Illinois hospital groups,  showing that the FTC and other agencies are  increasingly concerned about the ability of very big health systems to dramatically raise prices through their domination of their markets.

Recent studies that have shown the ability and indeed enthusiasm of big hospital systems for raising  prices much more than smaller systems or freestanding hospitals have added fuel to the regulatory fire.

The FTC said  that the  proposed merger of Advocate Health Care, Illinois’s state’s largest health system, and NorthShore University HealthSystem, could create a 16-hospital behemoth that would dominate the  affluent North Shore area of Chicago.

Deborah L. Feinstein, director of the agency’s Bureau of Competition, asserted that the proposed merger would probably significantly increase the combined system’s bargaining power with health-insurance plans, “which in turn will harm consumers by bringing about higher prices and lower quality.”
The hospital groups say they plan to fight the government’s move, citing the effects of the Affordable Care Act in encouraging  coordinating services and technology.

Besides the Illinois case, the FTC just in the past three weeks has moved halt the merger of two hospitals in West Virginia and joined with Pennsylvania authorities to try to stop an agreement between Penn State Hershey Medical Center and PinnacleHealth System.

The New York Times reported that James H. Skogsbergh, Advocate’s chief executive, defended the merger plan as “good for consumers and very pro-competitive.”  asserting that because the hospitals’ market was dominated by a major insurer, — Blue Cross Blue Shield —  the systems were “price takers, not price setters.”


FTC opposes big Pennsylvania system merger


The Federal Trade Commission  seeks  to block Penn State Hershey Medical Center’s proposed merger with PinnacleHealth System, asserting that the new central Pennsylvania  entity would raise prices and lower healthcare quality in the area.

“The proposed merger would eliminate the significant competition between these hospitals {hospital systems} resulting in higher prices and diminished quality,” said Debbie Feinstein, director of the FTC’s Bureau of Competition.

PinnacleHealth and Penn State Hershey responded by saying:

“We are extremely disappointed that the FTC does not share the enthusiasm of the many employers, community leaders, private physicians, commercial insurance providers and others who have recognized the benefits of our integration and demonstrated their broad support for it.”

The systems have asserted that the proposed merger would create “the depth of services and scale” needed to manage population health at the lowest possible cost.

But  hospital mergers have tended to be associated with higher prices in their regions as a result of less competition.

The FTC’s decision displays its continuing skepticism and frequent opposition to  hospital mergers, especially since 2007.

Deals that would give systems more than 40 percent of the market share  in their regions tend to ignite the agency’s opposition.

Hospitalist supervising residents overnight didn’t raise outcomes


In recent years, many teaching hospitals have established  overnight  hospitalist programs. In these,  hospitalist physicians supervise overnight medical residents with the idea that this would improve quality of care and boost safety.

But, Fiercehealthcare reports,  a recent study found that in one such program, at the Penn State Hershey Medical Center, “having an on-site, attending-level physician provide overnight supervision did not make a difference in quality of care. The medical center did not see any significant impact on important clinical outcomes, according to study results published in the Journal of General Internal Medicine.”

However, it should be noted, “the research looked at only one model of an overnight hospitalist program at one hospital and more study is needed into the pros and cons of such programs,” Fierce reported.


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