A new study in JAMA Internal Medicine has found that financial integration between physicians and hospitals has led to higher spending in outpatient care.
The healthcare business is no stranger to mergers and acquisitions, whether it’s the pharmaceutical industry or health insurers or providers of care. Over the past few years, physician practices have rapidly been acquired by large hospital systems. The launch of alternate payment models and accountable care organizations have pushed healthcare leaders to constantly modify their business plans. Now a new study in JAMA Internal Medicine has found that financial integration between physicians and hospitals has led to higher spending in outpatient care.
The authors, collected data on more than 7 million non-elderly enrollees in preferred-provider organizations or point-of-service plans that were included in the Truven Health MarketScan Commercial Database during the study period. Changes in physician-hospital integration between January 1, 2008, and December 31, 2012, was associated with changes in spending. The primary outcomes measures were annual inpatient and outpatient spending per enrollee and associated use of healthcare services.
Of the 240 metropolitan statistical areas (MSAs) covered by the study, a 3.3% increase in physician-hospital integration was observed during the 4-year study period. In terms of spending, the study recorded an average increase of $75 (95% confidence interval (CI), $38 to $113) per enrollee in annual outpatient spending. This translated into a 3.1% increase in in mean outpatient spending in 2012 to $2407 per enrollee (95% CI, $2400 to $2414). The authors recognized that this spending was driven entirely by price increase because minimal changes in healthcare utilization as observed in the study population. At the same time, inpatient spending and utilization remained steady.
The authors remark that consolidation is changing the balance in the healthcare marketplace and increasing an organizations market power with insurers.
“Payment reform is critically important to achieving a high-performing health system, but the price increases we found do suggest a potential unintended consequence,” said J. Michael McWilliams, associate professor of health care policy and medicine at Harvard Medical School, a practicing general internist at Brigham and Women's Hospital and senior author of the study.
The study has been coauthored by Michael E. Chernew, PhD, co-editor-in-chief of The American Journal of Managed Care.
Dr Dalia Rotstein: Physicians Must Be Aware MS Affects People of All Backgrounds
April 24th 2024Dalia Rotstein, MD, MPH, emphazises the importance of awareness that multiple sclerosis (MS) impacts patients from various backgrounds as clinicians think through ways to improve access to care and research efforts in MS.
Read More
Navigating Health Literacy, Social Determinants, and Discrimination in National Health Plans
February 13th 2024On this episode of Managed Care Cast, we're talking with the authors of a study published in the February 2024 issue of The American Journal of Managed Care® about their findings on how health plans can screen for health literacy, social determinants of health, and perceived health care discrimination.
Listen
The Federal Trade Commission's (FTC's) vote to ban most employers from issuing and enforcing noncompete clauses could have varying impacts on the health care workforce; federal regulators vastly under-enforced antitrust laws in the hospital sector during the last 2 decades, resulting in increased health costs; the FDA recently found genetic evidence of the H5N1 bird flu virus in pasteurized commercially purchased milk.
Read More
Drs Raymond Thertulien, Joseph Mikhael on Racial Disparities in Multiple Myeloma Care Access
December 28th 2023In the wake of the 2023 American Society of Hematology Annual Meeting and Exposition, Raymond Thertulien, MD, PhD, of Novant Health, and Joseph Mikhael, MD, MEd, FRCPC, FACP, chief medical officer of the International Myeloma Foundation, discussed health equity research highlights from the meeting and drivers of racial disparities in multiple myeloma outcomes.
Listen
What We’re Reading: Abortion Privacy Rules; Alzheimer Drug Hurdles; Nursing Home Staffing Overhaul
April 23rd 2024New health privacy rules aim to protect patients and providers in an evolving abortion landscape; some physicians express concerns about efficacy, risks, and entrenched beliefs in treating Alzheimer disease; CMS addresses longstanding staffing deficits in nursing homes.
Read More
Award-Winning Poster Presentations From AMCP 2024
April 23rd 2024At the Academy of Managed Care Pharmacy (AMCP) 2024 annual meeting, multiple poster presentations concerned with health equity, data collection, glucagon-like peptide-1 agonists, and more were acknowledged for their originality, relevance, clarity, bias, and quality.
Read More