Health care consolidation fuels spending and decreased quality of care in WNC
North Carolina is the most expensive state for health care in the country, with the highest average premium for residents with “plus-one” health insurance coverage through an employer at $4,781 annually.
Western North Carolina is no stranger to these high health care costs, and on the heels of a House Budget Committee hearing evaluating the budgetary effects of health care consolidation, I thought it important that I share what I learned with the people of North Carolina's 11th District.
On May 23, the House Budget Committee hosted a hearing titled “Breaking Up Health Care Monopolies: Examining the Budgetary Effects of Consolidation in Health Care Markets.” The hearing discussed the unsustainable trajectory of federal health spending and new policy opportunities to combat consolidation and enhance free market competition; or to put it simply, how to make health care more affordable and more accessible for the American people.
The key takeaway: the United States is experiencing a surge in hospital mergers, resulting in increased federal health spending and higher costs for patients.
Between 2000-2020, the United States experienced 1,164 hospital mergers, including the Mission HCA Healthcare acquisition in NC-11 in 2019. Multiple studies show consolidation results in price increases ranging from just under 10% to 31% over six years, depending on the size of the acquired and acquiring hospital. Meanwhile, the National Council on Compensation Insurance found that hospital mergers lead to operating cost reductions for acquired hospitals of 15-30%. This seems to imply that we’re paying more, while hospitals are paying less.
The American people deserve affordable, accessible, and high quality health care options, but that’s not what Western North Carolina residents are receiving today.
When the country’s largest investor-owned, for-profit hospital chain acquired a Western North Carolina-based hospital system, we were promised lower patient costs; but after the merger, prices rose higher than the average list prices of the 11 neighboring hospitals and annual mark-up prices nearly doubled to an average of 33 percentage points a year.
Arguably worse than the exponentially higher care costs, WNC patients have been faced with a less easily quantifiable impact of consolidation — lower quality of care. Quality of care is a critical metric for measuring the health and quality of life of citizens in NC-11; however, a Centers for Medicare and Medicaid Services report found at least three patients died and more were endangered at the merged hospital in 2022 and 2023 due to significant delays, negligence and lapses of care. This includes the administration of expired chemotherapy, insufficient staffing levels, and leaving unmonitored patients in the hallways. The hospital has submitted a plan to make amends, but the harm of consolidation has already been done.
Health care consolidation is a beast that is difficult to tackle, but I have already started to do the work. During the Budget hearing, Dr. Ippolito, senior fellow of the American Enterprise Institute, recommended Congress start by leveraging our authority to amend and change public programs to pinpoint features that encourage greater consolidation so we can cut those incentives off.
My colleagues and I started to do just that when we passed the Lower Costs, More Transparency Act out of the House last December, which expands site neutral payments and takes additional steps to increase cost transparency and reduce out-of-pocket costs for Americans seeking health care services and prescription drugs.
Western North Carolinians deserve better than the quality of care provided by HCA via Mission Health. That is why I’ve also demanded the Federal Trade Commission, the agency responsible for all acquisitions and mergers, re-review the Mission/HCA deal and take action to overturn the acquisition if malfeasance is found.
It is my mission as a member of the House Budget Committee and House Appropriations Committee to promote policies and funding that disincentive consolidation and promote greater choice, more affordable access and better quality of care for the citizens of NC-11 and beyond. The May 23 Budget hearing was a great start to the conversation, but the work has just begun.