Hospital mergers, and their acquisition of smaller practices, are a major driver of higher healthcare costs.

A hospital that controls more of a market has greater pricing power because insurers and employers have no choice but to include them in their networks.

Being the only option for care means they can extort higher reimbursement rates from businesses and insurers. Those higher rates are then passed on to workers and their families in the form of higher health insurance premiums.

In monopoly hospital markets, prices are 12 percent higher than when there are four or more competing hospitals. This results in an average premium increase of over $1,000 per year for families and over $370 per year for individuals enrolled in employer health plans.

From 2002 to 2023, US health systems announced more than 1,000 mergers and acquisitions.

By some estimates, 80 percent of hospital markets in the US are non-competitive.

North Carolina is no exception as our state has seen numerous mergers and consolidations over the past decade.

The problem extends beyond hospitals acquiring other hospitals. Big hospital systems are targeting independent physician practices too.

Today, nearly half of all American doctors are now employed by hospitals and health systems.

Costs are driven upwards as doctors become employed by health systems. It leads them to refer patients for more tests and more intense treatments, which increases revenue for their employer.  

Higher costs are not the only downside of anti-competitive healthcare markets.

Quality of care and patient experience also suffer.

The Affordable Healthcare Coalition of North Carolina is committed to lower costs and improving quality of care for businesses, workers, and their families. That means working to ensure a competitive marketplace of healthcare providers.