Hostname: page-component-cc8bf7c57-pd9xq Total loading time: 0 Render date: 2024-12-11T23:05:45.831Z Has data issue: false hasContentIssue false
  • English
  • Français

Considering the ACA's Impact on Hospital and Physician Consolidation

Published online by Cambridge University Press:  01 January 2021

Lawrence E. Singer
Get access Rights & Permissions [Opens in a new window]

Abstract

The Affordable Care Act did not start the consolidation rapidly occurring with hospitals/health systems and medical groups, but it most definitely accelerated the movement to combine. In the last five years, the number and size of consolidations have been at an all-time high. This comment reviews the degree to which consolidation has occurred and explores the key reasons behind these consolidations. It then posits that consolidations should be evaluated in light of the Triple Aim goals of enhancing access to care, reducing cost, and strengthening quality, and looks at the evidence to date in light of these goals.

Type
Symposium Articles
Information
Journal of Law, Medicine & Ethics , Volume 46 , Issue 4: Next Steps in Health Reform , Winter 2018 , pp. 913 - 917
Copyright
Copyright © American Society of Law, Medicine and Ethics 2018

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

See “Triple Aim for Populations,” Institute for Healthcare Improvement, available at <http://www.ihi.org/Topics/TripleAim/Pages/Overview.aspx> (last visited October 31, 2018) (“This is known as the IHI Triple Aim, and we believe it is the ultimate destination for the high-performing hospitals and health systems of the future.”).+(last+visited+October+31,+2018)+(“This+is+known+as+the+IHI+Triple+Aim,+and+we+believe+it+is+the+ultimate+destination+for+the+high-performing+hospitals+and+health+systems+of+the+future.”).>Google Scholar
“Change of control transactions” encompass the variety of ways that organizations may join together — such as through merger, consolidation, sale, change of sponsorship, change of membership or construction of a joint operating agreement — resulting in a change of ownership or the controlling party's ability to affect their will as compared to the ability to do so pre-transaction.Google Scholar
Chart 2.9: Announced Hospital Mergers and Acquisitions, 1998–2015, American Hospital Association, available at <https://www.aha.org/system/files/research/reports/tw/chartbook/2016/chart2-9.pdf> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Dafny, L., “Hospital Industry Consolidation — Still More to Come?” New England Journal of Medicine, January 16, 2014, available at <http://www.nejm.org/doi/full/10.1056/NEJMp1313948> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Creswell, J. and Abelson, R., “New Laws and Rising Costs Create a Surge of Supersizing Hospitals,” New York Times, August 12, 2013, available at <https://www.nytimes.com/2013/08/13/business/bigger-hospitals-may-lead-to-bigger-bills-for-patients.html> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Hall, K., 2017 in Review: The Year M&A Shook the Healthcare Landscape, available at <https://www.kaufmanhall.com/sites/default/files/2017-in-Review_The-Year-that-Shook-Healthcare.pdf> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
For statistics on this point, see generally Lichtenberger, S. et al., Provider Scale Strategies: The Evolving Landscape, McKinsey & Company, 2016, available at <http://healthcare.mckinsey.com/sites/default/files/Provider_scale_strategies-the_evolving_landscape.pdf> (last visited October 31, 2018).Google Scholar
Hall, K., supra note 6.Google Scholar
Kacik, A., “Mercy Health and Bon Secours to Merge,” Modern Healthcare, February 21, 2018, available at <http://www.modernhealthcare.com/article/20180221/NEWS/180229982> (last visited October 31, 2018). Other recent mergers include Ascension and Providence Health, Amita and Presence, and Advocate Health Care and Aurora Health Care.+(last+visited+October+31,+2018).+Other+recent+mergers+include+Ascension+and+Providence+Health,+Amita+and+Presence,+and+Advocate+Health+Care+and+Aurora+Health+Care.>Google Scholar
Szostak, D. C., “Vertical Integration in Health Care: The Regulatory Landscape,” DePaul Journal of Health Care Law 17, no. 2 (2015): 65–120 at 69.Google Scholar
Kash, B. and Tan, D., “Physician Group Practice Trends: A Comprehensive Review,” Journal of Hospital & Medical Management 2, no. 1:3 (2016): 1–8, at 1.CrossRefGoogle Scholar
Murphy, B., “For the First Time, Physician Practice Owners Are Not the Majority,” American Medical Association Wire, May 31, 2017, available at <https://wire.ama-assn.org/practice-management/first-time-physician-practice-owners-arenot-majority> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Downing, S.P. and DeGrande, C., “2017 Physician Practice Consolidation: A Mid-Year Review,” Becker's Hospital Review, July 25, 2017, available at <https://www.beckershospitalre-view.com/hospital-physician-relationships/2017-physician-practice-consolidation-a-mid-year-review.html> (last visited October 31, 2018). (last visited October 31, 2018).' href=https://scholar.google.com/scholar?q=Downing,+S.P.+and+DeGrande,+C.,+“2017+Physician+Practice+Consolidation:+A+Mid-Year+Review,”+Becker's+Hospital+Review,+July+25,+2017,+available+at++(last+visited+October+31,+2018).>Google Scholar
Dydra, L., “SK&A: 20 Medical Groups With the Most Physicians — The Permanente Group Tops the List,” Becker's Hospital Review, January 5, 2017, available at <https://www.beckershospitalreview.com/hospital-management-administration/sk-a-20-medical-groups-with-the-most-physicians-kaiser-permanente-medical-group-tops-the-list.html> (last visited October 31, 2018). (last visited October 31, 2018).' href=https://scholar.google.com/scholar?q=Dydra,+L.,+“SK&A:+20+Medical+Groups+With+the+Most+Physicians+—+The+Permanente+Group+Tops+the+List,”+Becker's+Hospital+Review,+January+5,+2017,+available+at++(last+visited+October+31,+2018).>Google Scholar
Id. Although arguably categorizing them as physician groups is misleading, as they have morphed into full-fledged health systems.Google Scholar
Schencker, L., “DuPage Medical Group Eyes Expansion With $1.45 Billion Investment,” Chicago Tribune, August 16, 2017, available at <http://www.chicagotribune.com/business/ctdupage-medical-group-investment-0817-biz-20170815-story.html> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Regulatory Overload Report, American Hospital Association, available at <https://www.aha.org/guidesreports/2017-11-03-regulatory-overload-report> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
See Fifer, R., “Health Care Economics: The Real Source of Reimbursement Problems,” American Speech-Language-Hearing Association, July 2016, available at <https://www.asha.org/Articles/Health-Care-Economics-The-Real-Source-of-Reimbursement-Problems/> (last visited October 31, 2018.+(last+visited+October+31,+2018.>Google Scholar
Frakt, A., “Hospitals Are Wrong About Cost Shifting to Insurers,” New York Times, March 23, 2015, available at <https://www.nytimes.com/2015/03/24/upshot/why-hospitals-are-wrong-about-shifting-costs-to-private-insurers.html?mtrref=www.google.com> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Medical Cost Trend: Behind the Numbers, PWC, June 2017, available at <https://www.pwc.com/us/en/health-industries/health-research-institute/behind-the-numbers/reports/hri-behind-the-numbers-2018.pdf> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Gaynor, M., “New Health Care Symposium: Consolidation and Competition in U.S. Health Care,” Health Affairs, March 1, 2016, available at <https://www.healthaffairs.org/do/10.1377/hblog20160301.053529/full/> (last visited October 31, 2018). For provider theories on how to reduce costs, such as population health, see PWC, supra note 17.+(last+visited+October+31,+2018).+For+provider+theories+on+how+to+reduce+costs,+such+as+population+health,+see+PWC,+supra+note+17.>Google Scholar
See PWC, supra note 20.Google Scholar
Even seemingly politically benign initiatives, with a high likelihood of driving cost savings, such as bundled payment, have been slowed.Google Scholar
See “Triple Aim for Populations, Overview,” supra note 1.Google Scholar
See, e.g., “New Research Finds Hospital Mergers Drive High-Value, High-Performing Health Care,” American Hospital Association, January 25, 2017, available at <https://www.aha.org/press-releases/2017-01-25-new-research-finds-hospital-mergers-drive-high-value-high-performing> (last visited October 31, 2018); see also J.D. Birkmeyer, “Why Health Care Mergers Can Be Good for Patients,” New England Journal of Medicine: Catalyst, October 24, 2016, available at <https://catalyst.nejm.org/why-health-care-mergers-can-be-good-for-patients/> (last visited October 31, 2018).+(last+visited+October+31,+2018);+see+also+J.D.+Birkmeyer,+“Why+Health+Care+Mergers+Can+Be+Good+for+Patients,”+New+England+Journal+of+Medicine:+Catalyst,+October+24,+2016,+available+at++(last+visited+October+31,+2018).>Google Scholar
Kacik, A., “Monopolized Healthcare Market Reduces Quality, Increases Costs,” Modern Healthcare, April 13, 2017, available at <http://www.modernhealthcare.com/article/20170413/NEWS/170419935> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar
Vogt, W.B. and Town, R., How Has Hospital Consolidation Affected the Price and Quality of Hospital Care? Robert Johnson Wood Foundation, available at <https://www.rwjf.org/content/dam/farm/reports/issue_briefs/2006/rwjf12056/subassets/rwjf12056_1> (available October 31, 2018).+(available+October+31,+2018).>Google Scholar
Devlin, R.A. et al., Practice Size, Financial Sharing and Quality of Care, BMC Health Services Research, available at <https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3819507/pdf/1472-6963-13-446.pdf> (last visited October 31, 2018); see also L.P. Casalino et al., “Large Independent Primary Care Medical Groups,” Annals of Family Medicine 14, no. 1 (2016): 16-25, at 24-25.+(last+visited+October+31,+2018);+see+also+L.P.+Casalino+et+al.,+“Large+Independent+Primary+Care+Medical+Groups,”+Annals+of+Family+Medicine+14,+no.+1+(2016):+16-25,+at+24-25.>Google Scholar
Dickson, V., “53% of Docs Still Not Transitioning to Value-Based Care,” Modern Healthcare, November 29, 2017, available at <http://www.modernhealthcare.com/article/20171129/NEWS/171129915> (last visited October 31, 2018).+(last+visited+October+31,+2018).>Google Scholar