As the COVID-19 crisis rages on, both physician-owned practices and smaller hospitals have found it difficult to manage costs and remain competitive with the larger healthcare corporations. The result has been a wave of new healthcare consolidation as big corporate providers consume small and independent operations.
Although this phenomenon was predictable as part of a larger trend of consolidation in healthcare, the pandemic intensified these trends, with larger players making increasingly aggressive moves to acquire smaller providers. While large corporations define mergers as a play to increase efficiency, the end result for consumers is often higher costs and less coordination with medical professionals. For example, a common complaint from consumers is that they have less time building a relationship with their doctor than they used to. Large healthcare corporations also tend to be less transparent and harder to communicate with than local practices. Authors of a study on healthcare consolidation from 2009-2013 found that “Hospital acquisition by another hospital or hospital system was associated with modestly worse patient experiences and no significant changes in readmission or mortality rates.”
Not all of the consolidation has been bad. One of the new trends driving it is the growth in telehealth. Telehealth allows patients to see a doctor from their smartphone or their laptop, dramatically reducing or eliminating the need for a commute to the doctor’s office. Healthcare corporations gobbled up smaller providers with telehealth expertise, spending more money on the practice and bringing it to a greater number of consumers. A result is that telehealth visits have become normalized and are now a regular aspect of medical care, potentially making it easier for the elderly and those with disabilities to get seen by a medical professional even if they cannot make a commute.
Still, real concerns remain about the dramatic increases in healthcare consolidation. Individuals and employers face higher insurance premiums as larger corporations increase costs. As consolidation increases, competitive pressures from other players in the industry decrease. That often means that the quality of care falls, and there are fewer options for patients to choose from if they don’t like the care they are receiving from their provider.
Unfortunately, healthcare consolidation isn’t a major political issue at the moment. There is unlikely to be any significant regulatory changes that reduce the number of healthcare mergers. As the pandemic eases, the pace of the mergers will slow, but they will not stop.
Patients should be aware of these larger trends within the healthcare space and understand that their relationships with local providers may change over time. That means staying on top of mergers and acquisitions in your area and keeping a list of alternative providers if your preferred doctor becomes unavailable.