Recent business consolidation in health care has spurred a need to weigh the benefits of integrating services against antitrust concerns.
Integration in health care has escalated in recent years, fueled by market forces and incentives in the Affordable Care Act (ACA). Two CHCF publications examine the trends and the role of antitrust enforcement in ensuring affordable, quality health care.
Despite the positive results promised by integration, a reduction in the number of health care competitors may result in higher costs, higher prices, and fewer or poorer-quality services for patients. Under federal antitrust laws, regulatory agencies have long monitored consolidation in order to protect consumer interests against the effects of concentrated market power.
The issue brief points to the inherent tension between the goals of integration and the assumptions that underlie a competitive marketplace, and points to two trends that providers will likely see in the future:
- Creation of more integrated systems that are better positioned to address population health
- Greater attention in the marketplace to strategic alliances between entities, rather than mergers
For health care organizations, the issue brief discusses the Federal Trade Commission guidelines for hospital mergers and provides questions that all entities should consider before entering into formal agreements.
The issue brief, a more detailed companion report by Health Management Associates, and a technical analysis of recently approved transactions are available as Document Downloads.