In case you missed it, a report from Kaiser Health News detailed the negative impacts of North Carolina’s billion-dollar hospital systems taking over independent healthcare practices.
As small, independent practices are taken over, costs go up, and the quality of care deteriorates.
Barak Richman, a law professor at Duke University who researches antitrust law and health care policy, notes that the “loss of independent physician practices threatens to fundamentally reshape the historical relationship between doctors and patients as more doctors become beholden to their employers instead of the people they treat.”
“Research shows that when doctors work for hospital systems they tend to refer patients for extra testing and more intense treatment, which means higher profits for hospitals,” said Richman.
Increased takeover of independent practices was exacerbated by how COVID-19 pandemic relief funds were distributed in the state.
“The rich got richer, and the poor got poorer,” Dr. Ge Bai told Kiser. Bai is professor of accounting and health and policy management at Johns Hopkins University where she studied how much relief money went to large hospital systems in the state.
A study by the North Carolina State Health Plan and the National Academy for State Health Policy found that $1.5 billion in taxpayer funded COVID relief was used by the state’s wealthiest hospitals to achieve record profits and a $7.1 billion growth in cash and investments during the pandemic.
And even though the tax dollars were intended to provide relief and ensure people could access care, the hospital systems did not share their profits with disadvantaged patients. In fact, charity care spending fell across a third of all North Carolina hospitals in 2020. Some hospitals even increased billing for poor patients eligible for charity care.
In her research, Bai discovered the relief funds were likely used “facilitate mergers and acquisitions.”
The same kinds of acquisitions that are increasing costs for patients, worsening care, and driving local, independent doctors out of business.
According to a 2021 Kaiser analysis, North Carolina has one of the most consolidated health care systems in the country. Nearly three-quarters of hospitals in the state belong to a large system.
Consolidation is one of the most pressing problems facing healthcare consumers in North Carolina today.
The problem will only get worse as mega-systems pursue more acquisitions and independent practices are squeezed out.
Solving it should be top of mind when our state’s legislative leaders next convene.
When big systems get bigger, doctors become employees, costs go up, quality of healthcare goes down and patients suffer.
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