While hospital systems and insurers consolidate, SERMO doctors concerned by lack of competition on both fronts

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In the U.S., consolidation in both the health insurance and hospital industries has raised red flags for federal and state regulators, doctors, and patients alike. With mergers stoking concerns about higher health care costs, we asked: which type of merger creates more problems for doctors?

Doctors are skeptical of the impacts of hospital mergers and insurance mergers in equal measure, according to our SERMO Poll of the Week, in which we asked doctors whether insurance mergers or health system/hospital mergers pose the bigger problem for U.S. physicians. 41 percent of more than 1800 doctors surveyed cited concerns about insurance mergers, while an equal 41 percent responded that hospital or health system mergers pose the larger problem for doctors. Just 18 percent said neither merger phenomenon would impact their practice negatively.

Insurance

It is estimated that during the upcoming open season, 19 percent of Americans buying health insurance through a federal marketplace will have just one insurer available to them – and an additional 19 percent will have only two options. Increasing concerns about this lack of competition, mergers between Aetna and Humana, and Anthem and Cigna, are looming on the horizon. One U.S. psychiatrist shared on the SERMO network, “Health insurance companies are big headaches. These companies are money hungry and provide little or no attention to patient care. It is very difficult to argue with them.”

In Washington, the Department of Justice has sued to block the Aetna-Humana and Anthem-Cigna mergers, with Attorney General Loretta Lynch remarking, “[The mergers] would leave much of the multitrillion-dollar health insurance industry in the hands of three mammoth insurance companies, drastically constricting competition in a number of key markets that tens of millions of Americans rely on to receive health care.” 

Hospitals

SERMO members are equally concerned with these hospital mergers—particularly their impacts on specialists and small practices – with good reason. Nationally, just 14 percent of large employers felt hospital mergers will reduce healthcare costs. Another 2016 academic analysis of more than 500 intrastate hospital mergers from 2000 to 2012 found that prices increased six to 10 percent after consolidation.

One anesthesiologist on SERMO remarked, “In markets with very limited hospital system competition physicians are forced to utilize hospital resources or become employees or risk losing all referrals.” An internist agreed, commenting, “Hospitals…control referrals for the specialists and squeeze the small primary care practices.”

What’s a Doc to Do?

Reinforcing the split decision about insurance and hospital mergers, SERMO doctors voiced their concerns about the impacts of both of these phenomena on their own practices. A surgeon wrote, “They are both detrimental to both cost control and innovation in health care. What you see is the [American Hospital Association] and [America’s Health Insurance Providers] working to continue their opaque economics as both doctors and patients lose.” A neurologist summed it up, saying “Both are bad. Why choose?”

Are you a SERMO member? We want to hear from you! Share your thoughts on these potential mergers by logging onto the SERMO network.

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