Decades of hospital and health system consolidation across the United States have created large regional and national health systems with the market power to raise prices. This consolidation trend has also included the downsizing or closing of hundreds of community hospitals, especially in low-income rural and urban areas, while health systems have been shifting facilities into middle-income suburban neighborhoods with large concentrations of commercially-insured residents. The people most affected by these trends have been those who are medically underserved, and the real-life consequences for individuals, families and communities amount to a national health equity crisis.

That’s what prompted Community Catalyst to submit comments to the U.S. Federal Trade Commission (FTC) and U.S. Department of Justice (DOJ) on April 20, in response to their Request for Information on how they should revise the guidelines anti-trust regulators use when reviewing proposed hospital mergers and acquisitions. We urged the FTC and DOJ to consider the potential impact of such transactions on health equity.

What are some of the health equity concerns federal anti-trust regulators should consider?

Our recommendations aim to address the impacts of rampant hospital consolidation on both the price of health care and access to care, especially in medically-underserved geographic regions:

• When hospitals merge, prices go up. There is a well-documented trend of hospital consolidation leading to increases in the price of health care, despite pre-merger promises of greater efficiency and lower costs. The results are higher premiums and deductibles for people with health insurance, and burdensome costs for those who lack insurance. We noted that employees of small businesses already have higher-than-average premiums and deductibles, and in some states, those employees are disproportionately Black, Latinx and other people of color. In states where Medicaid enrollees are subject to cost sharing, higher hospital prices could increase that burden.
• Medical debt increases, as do aggressive billing practices. People who are uninsured or under-insured face impossible choices of avoiding expensive, but needed, medical care or facing financial ruin and even medical bankruptcy. Making matters worse, health systems may introduce aggressive billing and collection practices at hospitals they acquire.
• Urban and rural communities of color lose their hospitals. In a market-driven health system, hospitals are expanding in middle-income and affluent areas with many commercially-insured residents. Left behind are urban and rural communities, especially communities of color, with many uninsured or publicly-insured residents, where hospitals are closing or downsizing. The COVID-19 pandemic starkly revealed the ways in which mal-distribution of hospital beds left these communities with dangerously overburdened safety-net hospitals.
• Continuity of care is interrupted when hospitals close obstetric services, ERs and ICUs. Hospital systems often acquire local hospitals and then downsize them, forcing patients to travel to “hub” hospitals for key services. The impact has been particularly acute for pregnant people, who are forced to travel long distances to other hospitals when local obstetric services are shuttered. More than half of rural counties now have no obstetric service, and counties with Black women of reproductive age who have low incomes are more likely to lose local labor and delivery units.
• Communities lose local control of their hospitals. When large health systems or private equity firms take over local hospitals, decision-making shifts to out-of-town executives. Health system priorities, practices and policies override community priorities. We noted that some health systems impose non-medical restrictions on access to care, causing a loss of key reproductive, obstetric, LGBTQ+-inclusive and end-of-life options. Private equity firms have loaded up hospitals with debt and stripped them of staff and key services.