News Clips
Healthcare Dive: (4/26) – The healthcare sector turned cautious in the first three months of 2022, completing 34 percent fewer deals than in the fourth quarter of 2021, according to a report from KPMG. Total transactions fell to 427 and private-equity deal volume dropped by half. Still, in the healthcare industry where hospital systems face increasingly challenging economics, KPMG expects IT and telehealth will continue to attract investment as virtual care expands further and improving interoperability for health records, billing and other systems remains a priority.
Health Affairs: (4/25) – Health care markets across the country are not functioning properly. Prices for health care are high, have increased rapidly, and vary in seemingly incomprehensible ways. Many researchers and policy makers have called for increased antitrust enforcement to help restore competition to health care markets. Despite this increased attention and increased success in challenging anticompetitive mergers in the past decade, more than 95 percent of hospital mergers go unchallenged. In this article, the authors argue that taxation provides another policy tool, and in some instances one more targeted at the harm of excessive prices for health care.
RevCycleIntelligence: (4/25) – The Federation of American Hospitals (FAH) has asked the Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) to maintain certain aspects of the hospital merger guidelines but modernize the enforcement of antitrust laws. In response to a Request for Information (RFI) on merger enforcement, FAH recommended that the federal agencies retain continuity in the hospital and health system merger guidelines. The organization stated that its members rely on the consistent and transparent guidelines the agencies use to analyze merger and acquisition activity.
Medical Economics: (4/25) – The author argues fee-for-service has never been right for primary care because it’s based on a service delivery model that rewards reactive, transactional, minimally functional interactions. Moving from fee-for-service to value-based care changes this, but only in an iterative way. Instead, and more specifically, we should be pushing for value-based care that relies on prospective payment models, which can drive transformative change for health care.
Modern Healthcare: (4/22) – Massachusetts' attorney general approved UnitedHealth Group's $236 million proposed purchase of Atrius Health, one of the largest not-for-profit physician groups in the state. As a condition of the deal, aside from transaction fees, proceeds from the sale must be transferred to the Atrius Health Equity Foundation. The deal will be sent to the Massachusetts Supreme Judicial Court for review.
RevCycleIntelligence: (4/22) – Physician practice acquisitions increased during the COVID-19 pandemic, resulting in nearly three-quarters of physicians being employed by hospitals, health systems, or other corporate entities, according to data from Avalere. Nationally, hospitals and other corporations acquired 36,200 additional physician practices between 2019 and 2021, leading to a 38 percent increase in the percentage of corporate-owned practices. More than 108,000 physicians became employees of hospitals or other corporate entities throughout the study period, representing a 19 percent increase in the percentage of employed physicians since. More than 75 percent of those employees (83,000) made the shift after the start of the pandemic.
JAMA Network: (4/22) – Many feel that bundled payment programs provide a promising path toward care redesign and payment reform, and prior studies have shown them to be associated with modest reductions in clinical spending with no compromise in quality. However, as CMS pushes for more participation in these models, it will be crucial for policy makers to address several concerns regarding benchmarks, market distortions, and health equity.
RevCycleIntelligence: (4/21) – Medium and large hospitals with low profit margins were more likely to experience ownership changes between 2016 and 2021 compared to their smaller and more profitable counterparts, according to a new report from HHS. The report from HHS analyzes new data on changes of ownership for hospitals and skilled nursing facilities enrolled in Medicare.
Fierce Healthcare: (4/21) – Hospitals and health systems believe a price transparency rule, while well-intentioned, is far too expensive to implement and is confusing, a new report found. The report underscores major compliance issues surrounding a landmark rule that requires hospitals to post payer-negotiated rates for certain services in an easy-to-understand format. Compliance with the rule has been scattershot since it went into effect last year.
Inside Sources: (4/20) – The COVID-19 pandemic has exacerbated the trend of hospital closures, with 11 hospitals closing in 2020 alone. Many hospitals and healthcare systems are turning to consolidation, as a result. The author argues the FTC is actively interfering in this important industry reorganization. The FTC’s opposition is predicated upon its outdated model of “healthcare competition,” which holds that consolidation of hospitals and healthcare providers will foster monopolization, reducing competition and increasing costs.
Fierce Healthcare: (4/20) – Hospitals in urban areas and with lower profit margins were more likely to be sold over the past six years, new federal data show. HHS released an analysis of hospital and nursing home mergers and acquisitions from 2016 through 2022. The agency also released raw data on changes of ownership for nursing homes and hospitals, as scrutiny intensifies on the impact of hospital mergers on cost and quality. Modern Healthcare: (4/19) – Investing in primary care as a preventative measure is associated with improved medical care quality, fewer hospital visits and lower spending overall, a study has found. If all California providers spent as much on primary care as the highest investing health systems, they could avoid 25,000 acute hospital stays and 89,000 emergency department visits while saving $2.4 billion in healthcare spending a year, according to a study funded by the California Health Care Foundation, Covered California and the Milbank Memorial Fund.
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