2017 Was A Record Year For Hospital Deals And Mergers, But Are They Good For The Patient?
In an ever-evolving health industry landscape, companies are trending toward pairing up to increase their chance at survival. But what does that mean for those in the health system?
The Star Tribune:
Health System Mergers In The U.S. At Record High
Hospital and health system mergers set a record in 2017, with a new report saying networks of care providers bulked up to offer a broader range of services and prepare for new contracts that ask health systems to take financial risk. The consulting firm Kaufman Hall tracked 115 hospital deals last year, including four in Minnesota. It was the single-highest annual tally since the company started tracking mergers in 2000, and was particularly noteworthy for deals involving systems with at least $1 billion in revenue. (Snowbeck, 1/29)
Left Out Of The Game: Health Systems Offer Direct-To-Employer Contracting To Eliminate Insurers
In 2016, Adventist Health began delivering healthcare services to Whole Foods' employees in Southern California. The partnership, in which Whole Foods bypassed insurance companies and negotiated directly for services from Roseville, Calif.-based Adventist, gave the organic supermarket chain access to a tailor-made health plan that it couldn't get from the traditional insurance market. Now the 19-hospital system is looking to scale the care navigation expertise developed while caring for Whole Foods employees to its Medicare accountable care organization. (Livingston, 1/27)
Venture Firm: Health System Investing Better In Numbers
McLaren Health Care's chief financial officer always asks himself the same question before throwing his system's money into a healthcare venture: Is this something we'd use? "Why do you want to invest in a company with products that you have no desire to ever want to use?" Dave Mazurkiewicz said. In that spirit, Mazurkiewicz is giving McLaren's support—in the form of an undisclosed financial investment—to a healthcare venture platform that won't necessarily call upon outside experts to vet potential ideas. Rather, it'll call upon its own investors—mostly health systems, but also insurers and healthcare vendors—to learn about what works in the industry. (Bannow, 1/29)
In other news from the health industry —
Most Physicians Don't Think Value-Based Payment Models Work
A majority of physicians don't believe pay for performance programs are effective solutions for quality improvement and cost control, according to a new survey from Leavitt Partners. Just 22% of the 621 doctors surveyed thought accountable care organizations would lower spending, and 21% supported using bundled payments to drive down costs. At the same time, 29% of doctors thought both ACOs and episode-based payment would improve patients' health outcomes. (Castellucci, 1/29)