Health care workers, researchers and observers warned federal regulators in a public listening session Wednesday that the consolidation is hurting employees and patients.
The Federal Trade Commission and the Department of Justice have asked for comments as they rework their guidelines on horizontal and vertical mergers. Most speakers claimed that mergers and acquisitions involving hospitals, doctors, pharmacy benefit managers and insurers have raised prices, stifled wages and reduced the quality of care.
“One thing we often hear from hospital executives trying to get their deal through is that the merger will be efficient, that it will reduce costs and allow them to improve quality,” said the president of the FTC, Lina Kahn, after hearing comments from nurses, doctors, pharmacists and patients. “As many of you have told us, sometimes this cost reduction can come at the expense of quality of care.”
Regulators have been looking closely at the impact of consolidation on labor markets, Kahn added, noting that mergers and acquisitions have allowed employers to dictate wages and worsen working conditions. The public comment period ends on April 21.
Here are five takeaways from the session:
- A nurse alleged that HCA Healthcare cut services, cut staff and increased prices after acquiring Mission Health in 2019. HCA closed primary care clinics, rural cancer facilities and other specialty clinics and increased costs price of 10% after the transaction, said Kelley Tyler, a nurse at Mission Hospital in Asheville, North Carolina eight minutes to spend with each patient, Tyler said. “We believe HCA is using its monopoly power over western North Carolina to take control of its healthcare system and then dump it on Wall Street and its shareholders,” Tyler said during the session, adding that HCA also owns supply chain companies, debt collection companies and a nursing school. “How can a company be allowed to influence and control all aspects of healthcare? HCA said in a statement that its financial support has expanded Mission Health’s high-quality care, with an “A” rating from Leapfrog, a $100 million increase in charitable care spending in 2020, and the expansion of rural hospitals and related services. HCA invested $300 million in Mission Health in 2021, the company said.
- ScionHealth, which was formed last year after the merger of LifePoint Health and Kindred Health, has cut benefits for employees at St. Joseph Regional Medical Center in Lewiston, Idaho, said Joe Thon, a nurse at St.Joseph. Their healthcare coverage network has shrunk while premiums have soared, he said. Management has also cut sick pay and retirement benefits, Thon said. Outsourcing some pharmacy services has increased nurses’ workloads and hurt patient care, he said. “Our hospital lost so many staff that we saw an entire unit shut down for almost two years,” Thon said. LifePoint responded but did not have a statement before publication.
- Mergers and acquisitions have kept hospitals from closing during the COVID-19 pandemic, said Lisa Goldstein, senior vice president of Kaufman Hall. Being part of a larger health system has allowed small, rural and medium-sized hospitals to have access to personal protective equipment, ventilators and staff, she said. Small hospitals may not have the resources to address issues like the social determinants of health, Goldstein said. “Without being part of a larger system, small hospitals will face closures or bankruptcies due to their inability to absorb very large and permanent increases in labor costs, to recruit the future workforce workers and future clinicians and treating an aging population,” she said.
- Consolidation tends to disproportionately impact people of color and low-income communities, said Lois Utley, senior adviser for the Hospital Equity and Accountability Project. Health systems are using the mergers to expand into predominantly white suburban areas with high concentrations of commercially insured patients while ditching hospitals in urban and rural communities of color, she said. They also tend to reduce or close maternity wards, emergency departments and other loss-making service lines, Utley said. “The consequences of these actions have been harshly exposed by the COVID-19 pandemic, which has revealed that Black, Latinx and Indigenous people have had a harder time finding care in their own communities,” he said. she stated.
- Consolidation among the three largest drug benefit managers and insurers has reduced access to the cheapest drugs, said Dr. Madelaine Feldman, a rheumatologist in New Orleans. PBMs often favor the more expensive options for rheumatoid arthritis drugs by removing generic alternatives from their formularies, she said. “Now that the big three PBMs have merged with some of the biggest health insurance companies, we have an oligopoly that has resulted in a broken system, plagued by conflicts of interest,” Feldman said. “It created a huge black box that PBMs protect with premiums and high drug prices if anyone tries to pull back the curtain.” The Pharmaceutical Care Management Association, which represents PBMs, responded by saying that PBMs offer $10 in savings for every dollar spent on PBM services in the form of negotiated discounts and rebates, 99.6% of which are passed on to consumers. patients and employers.