Health Industry Forum

November 9, 2015

Healthcare Consolidation: Winners, Losers and Policy Implications

Rapid growth in health care prices has been a major driver of health care spending growth since 2000. There has been substantial hospital system consolidation during this period and growing evidence of wide variations in commercial provider payments for the same clinical services in local markets. The formation of large integrated delivery networks and hospital employment of physicians has accelerated in response to the Affordable Care Act. The rationale for integrated delivery networks is to provide more coordinated care leading to better quality and lower costs. Despite this, evidence suggests that health care consolidation is associated with increased medical spending. Insurers are also consolidating in response to provider market power with two mega-mergers announced in the summer of 2015.

This forum will examine trends in healthcare industry consolidation and evidence about its effect on prices, medical spending and quality. It will specifically examine the impact of horizontal and vertical provider integration, and insurer consolidation. It will conclude with a discussion of the policy issues raised by the growing market power of providers and health plans along with federal and state policy options to bolster competition or regulate markets that lack competition.




Provider Consolidation: Trends & Outcomes
Lawton Robert Burns, PhD, MBA, The James Joo-Jin Kim Professor, Dept of Health Care Management, The Wharton School at the University of Pennsylvania

Provider Consolidation: Enforcement and Policy Perspectives from the Federal Trade Commission
Tara Isa Koslov, Deputy Director, FTC Office of Policy Planning

State Approaches to Addressing the Effects of Provider Consolidation
Robert A. Berenson, MD, Institute Fellow, The Urban Institute

State Approaches to Addressing the Effects of Provider Consolidation
Karen C. Tseng, Chief, Health Care Division, MA Attorney General’s Office