Since the Affordable Care Act was implemented, the number of hospital merger and acquisition deals jumped from 52 in 2009 to more than 100 in 2014, according to Irving Levin Associates. But the economic evidence suggests consolidation drives costs up, not down – and may even hurt patient care. Two thorough literature reviews, from 2006 and 2012, found that hospital consolidation generally results in higher prices. And when hospitals merged in already concentrated markets, the price increase was dramatic, often exceeding 20%. If policymakers don’t find more ways to inject competition into hospital markets soon, bigger price increases are likely waiting just a few years down the road.
