Recently a Kaiser Health News article http://capsules.kaiserhealthnews.org * noted: “A new study gives ammunition to what health economists and health insurers have argued for years: When hospitals buy physician practices, the result is usually higher hospital prices and increased spending by privately insured patients.”
“The study, published… in the journal Health Affairs, was based on an analysis of 2.1 million hospital claims from workers of self-insured employers between 2001 and 2007. The analysis by Stanford University researchers found prices were most likely to increase when hospitals bought physician practices, as opposed to hospitals forming looser contractual relationships with physicians.”
“Hospitals have increasingly bought physician practices over the past decade, arguing it helps them coordinate care and control costs. But insurers and many economists say hospitals’ main motivation is negotiating higher prices with insurers and building referrals to grow admissions.”
“The Affordable Care Act has accelerated the trend by encouraging the establishment of Medicare accountable care organizations that pay large groups of providers based on how well they control costs and improve quality.”
“The American Hospital Association, which defends hospital acquisitions as good for patients, called the study outdated and said it did not look at the impact on physician prices or spending, only those of hospitals.”
“Caroline Steinberg, the association’s vice president of trends analysis, said hospitals aren’t buying doctors to drive up prices. “Hospital are integrating with physicians because it is a necessary way to engage physicians in innovative payment methods such as bundling payments for one service such as hip replacements and ACOs,” she said.”
* to read the full KHN artcle “Hospitals’ Purchase Of Doctors Leads To Higher Prices, Spending, Study Finds” by Phil Galewitz, highlight and click on open hyperlink http://capsules.kaiserhealthnews.org/index.php/2014/05/hospitals-purchase-of-doctors-leads-to-higher-prices-spending-study-finds/?utm_campaign=KHN%3A+First+Edition&utm_source=hs_email&utm_medium=email&utm_content=12697567&_hsenc=p2ANqtz-9_4D0OOs46sDGv-LK0X94-ysIVxS7bpJyuV87jVJIxSsg4U80HxzrRvyBnMzDdpsc96PEAReH6Bke9-qatH841Ycu58AcQSB4esg4BA26kKqVPFBw&_hsmi=12697567
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Jonathan M. Metsch, Dr.P.H., is Clinical Professor, Preventive Medicine, Icahn School of Medicine at Mount Sinai; and Adjunct Professor, Baruch College ( C.U.N.Y.), Rutgers School of Public Health, and Rutgers School of Public Affairs and Administration.
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