Insurers fight provider consolidation

As the trend toward hospital mergers and acquisitions continues, America's Health Insurance Plans is pushing back against consolidation, saying it jeopardizes insurers' attempts to move toward a value-based reimbursement system, reported Forbes.

In Chicago, for example, Advocate Health Care and NorthShore University HealthSystem are planning a merger to create a 16-hospital, $6.8 billion system.

"Bigger hospitals really only mean bigger bills for patients," AHIP Vice President of Communications Brendan Buck told the Chicago Sun-Times. "Consolidation promises greater efficiency, but all that ever materializes is greater costs."

The problem, insurers say, is that provider mergers impede their ability to shift the industry to focusing on value over volume to temper rising costs. AHIP claims that hospital mergers and acquisitions have driven an increase in inpatient hospital prices, allowing providers to push back against insurers' attempts to negotiate lower payments.  

"The marketplace is moving strongly toward reform without a need for anticompetitive provider consolidation: and anticompetitive provider consolidation will undercut and impede reform," AHIP said in an amicus brief filed in a case brought by the Federal Trade Commission and the Idaho Attorney General that challenged St. Luke's Health System's acquisition of Idaho's largest independent doctor practice.

To learn more:
- here's the AHIP amicus brief
- see the Forbes article
- read the Chicago Sun-Times article