Consumer Engagement Needed to Keep Changing Hospital Landscape in Focus

The landscape of Connecticut’s hospitals is shifting rapidly. This change is happening on a number of fronts, but we are seeing three main trends:

  • Mergers, through which multiple hospitals consolidate (one example is Hartford Hospital bringing four hospitals – Windham, Midstate Medical Center, The Hospital of Central CT and Backus; and, three mental health facilities – Institute of Living, Natchaug Hospital and Rushford under the Hartford Healthcare banner).
  • Hospital acquisition of medical practices, which is happening throughout the state and raising questions of physician autonomy, billing practices and patient choice.
  • Proposed for-profit, national hospital network takeovers of nonprofit, community hospitals, such as Tenet Healthcare’s bid to acquire Waterbury, Bristol, Manchester and Rockville hospitals.

The state legislature is considering a few bills that address part, but not all, of the challenges our state faces regarding hospitals. What legislators do before the session ends on May 7 will likely leave the door open for continued uncertainty.

One thing we can be sure of is that all the stakeholders should be engaged in a discussion regarding the future of hospitals in Connecticut. And, that discussion should not just be about the bottom line or saving hospitals – but also about how we want our health care system to evolve to focus on the best patient care, improving health and slowing costs.

In the meantime, there is evidence that the mantra “bigger is better” does not bear out when it comes to hospital care and costs.

A report from the Robert Wood Johnson Foundation (RWJF), based on research conducted from 2006 -2012 examined the potential impacts on health care costs and quality when hospitals merge. It concluded that hospital consolidation generally does not improve quality nor reduce costs, but does result in higher prices.

  • Hospital concentration resulted in price growth according to analysis of data from a study in California.
  • A second study showed that Massachusetts hospitals increased prices when rival hospitals closed.

Greater efficiency is often the publicly stated reason for hospital mergers. If efficiency equals higher quality care and reduced costs due to economies of scale, studies cited in the RWJF report demonstrate the opposite.

  • When a hospital system gains too much market share, it has less incentive to keep prices down. As a result, health care costs rise sharply –often more than 20 percent — and the increases are passed on to consumers in the form of higher insurance premiums.

And when it comes to quality of care, the research suggests that quality only improves when there is an administered pricing system, such as Medicare. When hospitals are not subject to price regulation, there is no clear evidence of quality improvement.

  • The research concluded that when faced with tough competition, hospitals will compete on whatever brings in the most patients.

Evidence points to the fact that the hospital world is more challenged than ever. It’s time we all roll up our sleeves and work together to help guide the future of our state’s hospitals.

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2 Responses to Consumer Engagement Needed to Keep Changing Hospital Landscape in Focus

  1. Pingback: Legislative session closes next week, but much health care work still needs to be done | Universal Health Care Foundation of CT

  2. Pingback: End of Session Report | Universal Health Care Foundation of CT

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