KHN Morning Briefing

Summaries of health policy coverage from major news organizations

Mergers Among Hospitals And Doctors Spur Consumer Concerns, The NY Times Reports

News outlets report on the hospital market.

The New York Times: "[E]ight months into the new law there is a growing frenzy of mergers involving hospitals, clinics and doctor groups eager to share costs and savings, and cash in on the incentives [provided in the overhaul]. They, in turn, have deployed a small army of lawyers and lobbyists trying to persuade the Obama administration to relax or waive a body of older laws intended to thwart health care monopolies, and to protect against shoddy care and fraudulent billing of patients or Medicare. Consumer advocates fear that the health care law could worsen some of the very problems it was meant to solve - by reducing competition, driving up costs and creating incentives for doctors and hospitals to stint on care, in order to retain their cost-saving bonuses (Pear, 11/20).

Kaiser Health News reports on an expanding hospital system in California: "Through new construction and expanding its doctors' groups, Sutter Health is enhancing its position as one of the most dominant hospital systems in California. In addition, Sutter is further ahead of many competitors in fashioning itself into a so-called accountable care organization, responsible for coordinating care between hospitals, specialists and primary doctors. Although Sutter executives say these developments will improve patient care, some analysts and patient advocates worry about the growing leverage the nonprofit hospital system has in negotiating rates paid by insurers, employers and patients. Sutter already is the priciest health system in California" (Rau, 11/21).

In a companion piece, NPR and station KQED, in partnership with Kaiser Health News, reports that hospital "prices in the Sacramento region are among the highest in California, driven in large part by the negotiating clout of the hospital chain Sutter Health. Over the last decade and a half, Sutter has gradually accumulated hospitals and amassed a roster of doctors who contract exclusively with the company. Sutter is now one of the largest hospital chains in California with 24 acute care hospitals. … In fact, according to government data, Sutter's charges for a day of care are 37 percent more than the state average" (Varney, 11/20).

The Wall Street Journal: "New Jersey's nonprofit hospitals are financially weaker than elsewhere in the country, with increasing competition, a growing number of patients relying on government programs and below-average cash reserves, a recent report said. Moody's Investors Service cast a dim view of the state's hospitals in a review released this week, finding that with so much competition, there will be 'more closures, payment defaults, or bankruptcy filings over the next couple of years by hospitals that cannot manage expenses and invest in long-term strategies'" (Sataline, 11/20).

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