Physician-hospital consolidation reduces quality of care

Physician-hospital consolidation may hurt quality of care, because larger chains often don't understand community needs, according to Bridge Michigan.

Marquette General Hospital was transferred to new ownership in 2012, according to the article. It became one of many community hospitals in the state to have joined a larger chain since 2010 due to pressures such as the Affordable Care Act, a trend away from inpatient care, and lower Medicaid and Medicare reimbursement rates.

However, many in the community are concerned that consolidation will mean higher costs and less personal, lower-quality care, according to the article.

"We do have concerns about the ability of very large corporations, especially for-profit corporations, to interact and respond to the community's needs in the same way as hospitals in the past have been able to do," Marjorie Mitchell, executive director of the Michigan Universal Health Care Access Network, told Bridge. "The decisions are being made far away,"

In addition, consolidation sometimes correlates with higher costs and lower quality care, according to another Bridge article. Consolidation, when it gives one chain too great a market share, disincentivizes low prices and a competitive healthcare landscape is associated with quality outcomes, according to 2012 research from the Robert Wood Johnson Foundation

"This stands to reason: If hospitals can compete on both price and quality, then when they face tougher competition they will choose to compete by whichever means is most effective," the brief states. "If buyers are considerably more responsive to price than quality (for example, if price is easier to measure), then enhanced competition can lead to lower prices, but also less attention to quality."

A February column in Forbes predicted consolidation within the industry will rise in response to increased focus on care value, with unaffiliated hospitals and physician practices becoming "a thing of the past," FierceHealthcare previously reported.

To learn more:
- here's the first article
- read the second article
- here's the brief (.pdf)