Bring patients to the table during hospital merger negotiations, report suggests

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Patients should play a greater role in the healthcare merger process, according to a new report. (Pixabay)

Since the healthcare industry is not losing its appetite for mergers, state regulators need to do more to get patients and consumers involved in the process, according to a new report. 

MergerWatch, a patient advocacy group that monitors healthcare consolidation, compared Certificate of Need policies between states and found that only 10 states require a review of mergers that could lead a hospital to close or discontinue a service line.

Just eight states require a review in cases that are less formal than a sale, purchase or lease. 

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Consumers are included in advisory or governing boards that monitor hospital mergers in nine states, according to the report. A total of 35 states have a CON process for hospital mergers, and California uses a similar program as well. 

"We think that state oversight of hospital consolidation can only be improved by notifying, engaging and listening to consumers," Lois Uttley, director of MergerWatch and the report's lead author, told FierceHealthcare. "Consumers on the ground often have useful insights about the potential impact of closing or reconfiguring hospital services." 

RELATED: Hospitals make 'land grab' in effort to expand reach to patients, decrease healthcare costs 

Analysts don't predict that the healthcare industry will lose interest in consolidation any time soon. West Monroe Partners, a consulting firm, conducted a survey of 100 healthcare companies and private equity firms, and found 79% intended to seek additional joint ventures or alliances over the next 12 to 18 months. 

Kaufman Hall also projected a robust merger market this year, noting that 31 deals were announced in the first quarter of this year, topping both 2017 and 2016. The firm believes that these deals will grow in value, too, over the course of the year. 

Hospital mergers are often considered on business merits alone, which studies have found can jeopardize patient safety. Greater dialogue with patients during the process could flag some of those concerns, Uttley said.

RELATED: Hospitals may take financial hit following merger 

Patients would be able to point out potential access gaps—such as increased travel time if certain specialties are consolidated—and offer insight into what elements of the care experience they value most, Uttley said. Or a hospital could, postmerger, scale back the availability of midwives in an obstetrics unit where they're popular with patients. Having a dialogue with them could flag pain points during the merger process, she said. 

Better consumer engagement around mergers should be a priority for healthcare executives since it can lead to greater community buy-in during the process, Uttley said.

MergerWatch suggests several policy changes that could improve transparency and better draw patients into the discussion. Those include: 

Connect with and inform patients that would impacted by a merger. This includes ensuring they have significant advanced notice of any facility closures or the cancellation of any service lines.

Boost consumer representation on governing boards and in the CON process. Display letters of intent so that they're easy for patients to access, and add patients to oversight boards if needed.

Push merging healthcare organizations to have plans for potential access gaps. If a hospital will be closed during a merger, for example, there should be a backup plan for patients that sought care there, according to the report.

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