Rural hospitals saw mortality improvements after acquisition deals, study finds

A new study published this week in JAMA Network Open adds to the contentious debate over the pros and cons of hospital consolidation.

In it, researchers analyzing rural hospital acquisitions found improved mortality rates across multiple common conditions—acute myocardial infarction (AMI), heart failure, stroke and pneumonia—when compared to equivalent facilities that remained independent.

“The findings of this study regarding the positive outcomes associated with mergers in rural hospital quality challenge a common argument in prior research that hospital consolidation is likely to result in greater market power and higher prices but poorer quality,” researchers from the Agency for Healthcare Research and Quality and IBM Watson Health wrote in the journal.

Acquired hospitals’ AMI mortality rates saw the quickest improvement of the bunch, with the researchers noting a significant decline compared to independent hospitals as soon as one year after acquisition but for as long as four years.

The analysis did not reveal improvements across the other conditions until three to five years after the rural hospitals' acquisition, they wrote.

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Mortality rates at both merged and comparison hospitals remained similar for patients with gastrointestinal hemorrhages or hip fractures, according to the study. Combining overall mortality changes for all six measured conditions showed a significantly greater decline in mortality at acquired rural hospitals.

Elective procedure complications decreased over time but at similar rates across both study groups, the researchers wrote.

Additionally, the analysis found an increase in AMI volume across acquired rural hospitals but the opposite at those that remained independent. Volumes remained stable for both settings while heart failure, stroke, gastrointestinal hemorrhage, pneumonia and elective procedures all declined.

The researchers noted that their findings differed from other studies that monitored quality changes following consolidation within urban markets, which found either no change or a decline following hospital acquisition.

The difference, they theorized, could be that rural hospital mergers more often allow these facilities “to improve quality of care through access to needed financial, clinical and technological resources, which is important to enhancing rural health and reducing urban-rural disparities in quality. This hypothesis needs to be assessed using data sources that capture data both on quality and hospital resources,” the researchers wrote.

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The team conducted their analysis using data collected from Irving Levin Associates, the American Hospital Association Annual Survey and the Healthcare Cost and Utilization Project State Inpatient Databases.

They identified 172 rural non-rehabilitation hospital mergers between 2009 and 2016 across 32 states as well as 266 comparison hospitals that did not undergo a merger. The final analysis matched patient, hospital and community characteristics for the six common conditions and elective procedure complications across a sample of nearly 500,000 stays at merged hospitals and nearly 750,000 stays at unmerged hospitals.

The industry’s back and forth on whether provider consolidation leads to worse care and higher prices has recently made its way to the White House. In July, President Joe Biden issued a sweeping executive order that called upon the Justice Department and the Federal Trade Commission to “review and revise merger guidelines to ensure patients are not harmed by such mergers.”

The move quickly garnered pushback from the hospital industry, which last month called for a meeting with federal officials to discuss the added scrutiny.

“The fact is that most proposed hospital mergers present no competitive issues and offer real benefits for those communities,” American Hospital Association CEO Rick Pollack wrote in a letter to the agencies.