Mergers & monopolies in health care --> higher prices

Undoing Health System Monopolies May Be a Lost Cause

By Elisabeth Rosenthal, The New York Times, July 25, 2023

After decades of unchecked mergers, health care is the land of giants, with one or two huge medical systems monopolizing care top-to-bottom in many cities, states and even whole regions of the country. Reams of economic research show that the level of hospital consolidation today — 75 percent of markets are now considered highly consolidated — decreases patient choice, impedes innovation, erodes quality and raises prices…

For many years in the last century the Federal Trade Commission made little effort to go to court to block hospital mergers because judges tended to rule that as nonprofit entities, hospitals were unlikely to use monopoly power to pursue abusive business practices. How wrong they were

The F.T.C. has an even harder time evaluating the vertical merger, which is far more common: when a big hospital system buys up a much smaller hospital or some doctors’ practices and independent surgery or radiology centers — or when it merges with a local insurer.

Many such mergers are never vetted at all, since transactions under $111 million do not have to be reported to the agency… [Many of these are large health systems buying up small practices, reducing patient choice.]…

The newest challenge is how to handle the growing number of cross-market mergers, where huge health systems in different parts of a state or of the country join forces. While the hospitals are not competing for the same patients, emerging research shows that these moves result in higher prices, in part because the increased negotiating clout of the enormous health system forces companies that cover employees in both markets to pay more in what previously was the cheaper region…[end quote]

This is a Macro trend that affects every American family and increases Medicare spending as well.



One of the biggest reasons a small (or medium sized) practice agrees to be acquired is that the paperwork (may be mostly computerized today, but it’s still classified as “paperwork”), and the cost of doing the paperwork, has overwhelmed them. I know an anesthesiologist that used to have their own practice, but the billing and other management simply became too much, so he dropped his practice and became a hospital employee instead. This was quite a few years ago already. At this point, I doubt there are very few sole practitioner anesthesiologists anymore.

And much (most) of the paperwork is due to government, the regulations they create, and insurance companies, and their myriad requirements. So I’m not convinced that MORE government, and more regulations, is the solution to this problem. I’m not even sure there is a solution to this problem anymore.


I live somewhere with a lot of doctors and I know a lot of them. The big complaint the last few years is that they can hardly make a living anymore because all the support workers are consuming the reimbursement money from insurance or medicare. Many of the older ones have retired and said they themself make such a small amount that it isn’t worth working anymore. And a lot of them went to work for hospitals or huge practices or minute clinics as a regular salaried employee. One guy I know went to work for an insurance company probably to help them deny claims. Its crazy it used to me that you became a doctor and made a very good living with some hassle but you still had days off to golf and stuff but today its not so much fun like it used to be.


The USA health industry is a monster of inefficiency not in service to the customers but to the more powerful employees of the system (doctors and administrators), but mostly to the bizarre non-competitive corporations (profit and non-profit) that own most of it.

The rest of the world looks at us with horror (that we do it our stupid way) and envy (that we are so absurdly rich that we can afford so much waste and so negligent of the powerless that we do not care that they get ground up in the messes).

In Spain, as a “for instance”, I got superb efficient medical attention and treatment that was radically more cost effective in almost every way than what I was used to in the USA. When, after my first encounter with their system, I enquired as to payment the “customer help” desk lady kindly smiled and said "Somewhere in Madrid some bureaucrat will get your file and figure out who pays how much for what you got done, This is a medical center, and here we do medicine, not accounting.

david fb


I’d love to hear what government paperwork is involved here. I suspect the vast majority is insurance processing.