Intermountain, Sanford to merge into 70-hospital system

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/intermountain-sanford-to-merge-into-70-hospital-system.html?utm_medium=email

Top 10 Largest Health Systems in the U.S.

Salt Lake City-based Intermountain Healthcare and Sioux Falls, S.D.-based Sanford Health have signed a letter of intent to merge. 

The boards of both nonprofit organizations unanimously approved on Oct. 23 a resolution to support moving forward with the due diligence process. Pending regulatory and state approvals, the merger is expected to close in 2021. 

“We’re hoping that the actions taken … just 72 hours ago will culminate in a combined organization next summer,” Kelby Krabbenhoft, president and CEO of Sanford Health, said during an Oct. 26 news conference. 

Existing boards of trustees from both systems will join to form a combined board, and Gail Miller, chair of the Intermountain board, will serve as board chair of the merged organization. 

Marc Harrison, MD, president and CEO of Intermountain, will serve as president and CEO of the combined system, which will operate 70 hospitals and employ more than 89,000 people. Mr. Krabbenhoft will serve as president emeritus. 

“These are two great organizations with strong histories that are economically and clinically very strong,” Dr. Harrison said during the news conference. “This is something that should happen for the future of American healthcare.” 

Intermountain will be the parent company of the combined organization, and the merged system will be headquartered in Salt Lake City. 

Einstein warns of cuts, ‘death spiral’ without Jefferson merger

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/einstein-warns-of-cuts-death-spiral-without-jefferson-merger.html?utm_medium=email

How to emerge from a 'death spiral' in stocks - MarketWatch

In a court filing, Einstein Healthcare Network warned that a move by the Federal Trade Commission to block its merger with Jefferson Health could lead to a “death spiral” at its Philadelphia flagship safety-net hospital, according to the Philadelphia Business Journal.

In court documents opposing an FTC analysis of the merger, Einstein said that its financial condition has deteriorated since 2017, resulting in operating losses averaging about $30 million per year.

Einstein said it will incur even greater losses, largely because of the challenging payer mix and large underinsured or uninsured population of its flagship Philadelphia medical center. 

Without a merger, “Einstein [would have to] dramatically cut its services at Einstein Medical Center Philadelphia, leading to job losses and even further reductions in maintenance and needed investment, precipitating a ‘death spiral’ that would jeopardize access to health care for many of Philadelphia’s underserved residents,” Einstein wrote in the documents, according to the Philadelphia Business Journal. 

The FTC announced in February its intent to sue to block the proposed merger, arguing that combining the two systems would reduce competition in Philadelphia and Montgomery counties.

“Jefferson and Einstein have a history of competing against each other to improve quality and service,” the FTC said in February. “The proposed merger would eliminate the robust competition between Jefferson and Einstein for inclusion in health insurance companies’ hospital networks to the detriment of patients.”

Einstein and Jefferson Health countered that a combined system still would face competition from other hospitals and operate in a challenging market dominated by one healthcare insurer, according to the report. 

Election 2020: Trump and Biden’s starkly diverging views on healthcare

https://www.healthcaredive.com/news/presidential-election-2020-trump-biden-different-healthcare-policies-ACA-coronavirus/585184/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202020-10-01%20Healthcare%20Dive%20%5Bissue:29992%5D&utm_term=Healthcare%20Dive

Spoiler: the 2 nominees differ on almost everything.

President Donald Trump and Democrat nominee Joe Biden’s starkly contrasting views on healthcare were laid bare during this week’s chaotic debate. But some major industry executives noted at a recent conference they’ve done relatively well under Trump and could likely weather a Biden presidency, given his moderate stance and rejection of liberal dreams of “Medicare for All.”

The former vice president stresses incremental measures to shore up President Barack Obama’s landmark Affordable Care Act. Trump’s campaign website has no list of healthcare priorities, making his record even more relevant to attempts to forecast his future policies.

“I think a lot of the president’s second term agenda will be extensions of things he’s done in his first term,” Lanhee Chen, domestic policy director at Stanford University’s Public Policy program, said at AHIP in September.

Either way, the impact of whoever lands in the White House next year still matters for the industry’s future.

And 33 seats in the Senate are also up for grabs in November, complicating the outlook. Two scenarios would likely lead to health policy gridlock, according to analysts and DC experts: Trump wins regardless of Senate outcome, or Biden wins and Republicans maintain control of the Senate. A third scenario, where Biden wins and Democrats retake the Senate, would be the most negative for healthcare stocks, Jefferies analysts say, while the other two outcomes would be a net positive or mostly neutral.

Here’s a look at where the candidates stand on the biggest healthcare issues: the coronavirus pandemic, the Affordable Care Act, changes to Medicare and Medicaid and lowering skyrocketing healthcare costs.

COVID-19 response

Trump

Of all wealthy nations, the U.S. has been particularly unsuccessful in mitigating the pandemic. The U.S. makes up 4% of the global population, but accounted for 23% of all COVID-19 cases and 21% of all deaths as of early September.

Public health experts assign the majority of the blame to an uncoordinated federal response, with the president electing to take a largely hands-off approach to the virus that’s killed nearly 207,000 people in the U.S. to date. That backseat stance is unlikely to change if Trump is elected to a second term.

In March, Trump said a final COVID-19 death toll in the range of 100,000 to 200,000 Americans would mean he’s “done a very good job.”

Critics blame shortages of supplies like test materials, personal protective equipment and ventilators, especially in the crucial early days of the pandemic, on Trump’s approach. States and healthcare companies have also reported challenges with shifting federal guidelines on topics from risk of infection to hospital requirements for reporting COVID-19 caseloads.

Trump has also pushed unproven treatments for COVID-19, giving rise to concerns about political influence on traditionally nonpartisan agencies like the Food and Drug Administration and the Centers for Disease Control and Prevention.

These concerns have colored Operation Warp Speed, the administration’s public-private partnership to fast-track viable vaccines. The operation received $10 billion in funds from Congress, but administration officials have also pulled $700 million from the CDC, even as top health officials face accusations of trying to manipulate CDC scientific research publications.

Fears that political motivations, not clinical rigor, are driving the historically speedy timeline could lower public trust in a vaccine once it’s eventually approved.

Trump has also repeatedly refused to endorse basic protections like widespread mask wearing, often eschewing the face covering himself in public appearances. He’s consistently downplayed the severity of the pandemic, saying it’ll go away on its own while suggesting falsely that rising COVID-19 cases were solely due to increased testing.

While Trump’s list of priorities for his second term include “eradicating COVID-19,” the plan is short on details. His most aggressive promise has been approval of a vaccine by the end of this year and creating all “critical medicines and supplies for healthcare workers” for a planned return to normal in 2021, along with refilling stockpiles to prepare for future pandemics.

Biden

Biden, for his part, would likely work to enact COVID-19 legislation and dramatically change the role of the federal government in pandemic response first thing if elected.

The Democratic candidate says he would re-assume primary responsibility for the pandemic. He plans to “dramatically scale up testing” and “giving states and local governments the resources they need to open schools and businesses safely,” per an August speech in Wilmington, Delaware.

Biden says he’d take a backseat to scientists and allow FDA to unilaterally make decisions on emergency authorizations and approvals.

The candidate supports reopening an ACA enrollment period for the uninsured, eliminating out-of-pocket costs for COVID-19 treatment, enacting additional pay and protective equipment for essential workers, increasing the federal match rate for Medicaid by at least 10%, covering COBRA with 100% premium subsidies during the emergency, expanding unemployment insurance and sick leave, reimbursing employers for sick leave and giving them tax credits for COVID-19 healthcare costs.

Trump opposes most of these measures, though he did sign COVID-19 relief legislation that upped the Medicaid match rate by 6.2% and extended the COBRA election period, though without subsidies.

Biden has said he’d be willing to use executive power for a national mask mandate, though ensuring compliance would be difficult. He’d also rejoin the World Health Organization, which Trump pulled the U.S. out of in May.

Affordable Care Act

Trump

On his first day in office, Trump issued an executive order saying: “It is the policy of my Administration to seek the prompt repeal of the Patient Protection and Affordable Care Act.” But after the Republican repeal-and-replace effort floundered in 2017, the administration began steadily chipping away at key tenets of the decade-old law through regulatory avenues.

Trump has maintained he’ll protect the 150 million people with preexisting conditions in the U.S. But despite publicly promising a comprehensive replacement plan on the 2015 campaign trail (and at least five times this year alone), Trump has yet to make one public. The president did in September sign a largely symbolic executive order that it’s the stance of his administration to protect patients with preexisting conditions.

The president doesn’t mention the ACA in his list of second term priorities. The omission could have been intentional, as Trump is backing a Republican state-led lawsuit seeking to overturn the sweeping law, now pending in front of the U.S. Supreme Court and scheduled for oral arguments one week after the election.

The death of liberal justice Ruth Bader Ginsburg puts the law in an even more precarious position.

And Trump’s health agencies have enacted myriad policies keeping the law from functioning as designed.

The president signed legislation zeroing out the individual mandate penalty requiring people to be insured in 2017. The same year, he ended cost-sharing reduction payments to insurers, suggesting that would cause the ACA to become “dead.” But the marketplace generally stabilized.

The administration has also increased access to skimpier but cheaper coverage that doesn’t have to comply with the 10 essential health benefits under the ACA. The short-term insurance plans widely discriminate against people with pre-existing health conditions, even as a growing number of Americans, facing rising healthcare costs, enrolled, according to a probe conducted by House Democrats this year.

Trump has also encouraged state waivers that promote non-ACA plans, cut funding for consumer enrollment assistance and outreach, shortened the open enrollment period and limited mid-year special enrollments.

​Despite his efforts, the ACA has grown in popularity among voters on both sides of the aisle, mostly due to provisions like shoring up pre-existing conditions and allowing young adults to stay on their parent’s insurance until age 26.

Biden

If elected, Biden would likely roll back Trump-era policies that allowed short-term insurance to proliferate, and restore funding for consumer outreach and assistance, political consultants say.

Building on the law is the linchpin of Biden’s healthcare plan. The nominee has pledged to increase marketplace subsidies to help more people afford ACA plans through a number of policy tweaks, including lowering the share of income subsidized households pay for their coverage; determining subsidies by setting the benchmark plan at the pricier “gold” level; and removing the current cap limiting subsidies to people making 400% of the federal poverty level or below.

Biden maintains as a result of these changes, no Americans would have to pay more than 8.5% of their annual income toward premiums. They could save millions of people hundreds of dollars a month, according to a Kaiser Family Foundation analysis. Commercial payers mostly support these efforts, hoping they’ll stabilize the exchanges.

But a second prong of Biden’s health strategy is deeply unpopular with private insurers: the public option. Biden’s called for a Medicare-like alternative to commercial coverage, available to anyone, including people who can’t afford private coverage or those living in a state that hasn’t expanded Medicaid.

The rationale of the public plan is that it can directly negotiate prices with hospitals and other providers, lowering costs across the board. However, market clout will depend on enrollment, which is still to-be-determined.

Critics see the plan, which by Biden’s estimate would cost $750 billion over 10 years, as a down payment on Medicare for All. And the private sector worries it could threaten the very profitable healthcare industry, which makes up about a fifth of the U.S. economy.

Medicare

Trump

Neither Trump nor Biden supports Medicare for All, dashing the hopes of supporters of the sweeping insurance scheme for at least another four years.

“It has a pulse — it’s not dead — I just don’t see it happening in any near term,” John Cipriani, vice president at public affairs firm Global Strategy Group, said at AHIP.

Trump has promised to protect Medicare if elected to a second term, and it’s unlikely he’d make any major changes to the program’s structure or eligibility requirements, experts say.

But Medicare is quickly running out of money, and neither Trump nor Biden has issued a complete plan to ensure it survives beyond 2024. Political consultants think it’ll teeter right up to the edge of insolvency before lawmakers feel compelled to act.

The president’s administration has allowed Medicare to pay for telehealth and expanding supplemental benefits in privately run Medicare Advantage programs, efforts that would likely bleed into his second term — or Biden’s first, given general bipartisan support on both, experts say.

Under Trump, HHS did pass a site-neutral payment policy, cutting Medicare payments for hospital outpatient visits in a bid to save money. But Democratic lawmakers have argued Trump’s calls to get rid of the federal payroll tax, which partially funds Medicare, could throw the future of the cash-strapped program in jeopardy.

The president has also signed legislation experts say accelerated insolvency, including the Tax Cuts and Jobs Act of 2017, the Bipartisan Budget Act of 2018 and the Further Consolidated Appropriations Act of 2020, which repealed the ACA’s Cadillac tax — a tax on job-based insurance premiums above a certain level.

Nixing that tax lowered payroll tax revenue, also dinging Medicare’s shrinking trust fund.

Trump’s proposed budget for the 2021 fiscal year floated culling about $450 billion in Medicare spending over a decade. And repealing the ACA would also nix provisions that closed the Medicare prescription drug “donut hole,” that added free coverage of preventive services and reduced spending to strengthen Medicare’s winnowing Hospital Insurance Trust Fund.

Biden

Biden has proposed lowering the Medicare age of eligibility to 60 years, with the option for people aged 60-64 to keep their coverage if they like it. The idea is popular politically, though providers oppose it, fearful of losing more lucrative commercial revenue.

It would make about 20 million more people eligible for the insurance, but could also add even more stress onto the program, experts say. Biden’s campaign says it would be financed separately from the current Medicare program, with dollars from regular tax revenues, and will reduce hospital costs.

Biden also says he’d add hearing, vision and dental benefits to Medicare.

Medicaid

Trump

Trump’s tenure has also been defined by repeated efforts to prune Medicaid. The president has consistently backed major cuts to the safety net insurance program, along with stricter rules for who can receive coverage. That’s likely to continue.

Republican lawmakers maintain the program costs too much and discourages low-income Americans from getting job-based coverage, and have enacted policies trying to privatize Medicaid. The Trump administration took a step toward a long-held conservative dream earlier this year, when CMS invited state waivers that would allow states to deviate from federal standards in program design and oversight, in exchange for capped funding.

So far, no states have enacted the block grants.

The administration also aggressively encouraged states to adopt work requirements, programs tying Medicaid coverage to work or volunteering hours. A handful of states followed suit, but all halted implementation or rolled back the idea following fierce public backlash and legal ramifications.

And repealing the ACA would ax Medicaid expansion, which saved some 20,000 lives between 2014 and 2017, according to the Center on Budget and Policy Priorities.

Biden

Biden, however, wants to preserve expansion, and would take a number of other steps to bolster the program, including increasing federal Medicaid funding for home- and community-based services. The roughly 4.8 million adults in states that elected not to expand Medicaid would be automatically enrolled into his public option, with no premium and full Medicaid benefits.

Additionally, states that have expanded Medicaid could elect to move their enrollees into the public option, with a maintenance-of-effort payment.

Lowering costs of drugs and services

Trump

Efforts to lower prescription drug costs have defined Trump’s healthcare agenda in his first term, and been a major talking point for the president. That’s more than likely to continue into a second term, experts say, despite a lack of results.

Trump did cap insulin costs for some Medicare enrollees, effective 2021. He also signed legislation in 2018 banning gag clauses preventing pharmacists from telling customers about cheaper options.

But despite fiery rhetoric and a litany of executive orders, Trump has made little if any concrete progress on actually lowering prices. One week into 2020, drugmakers had announced price hikes for almost 450 drugs, despite small price drops earlier in Trump’s tenure.

Trump has proposed several ideas either dropped later or challenged successfully by drugmakers in court, including allowing patients to import drugs from countries like Canada, banning rebates paid to pharmacy benefit manufacturers in Medicare and forcing drugmakers to disclose the list prices of drugs in TV ads.

The president has signed recent executive orders to lower costs largely viewed as pre-election gambits, including one tying drug prices in Medicare to other developed nations and another directing his agencies to end surprise billing. Implementation on both is months away. Trump has also promised to send Medicare beneficiaries $200 in drug discount cards before the election, an effort slammed as vote-buying that would cost Medicare at least $6.6 billion.

Both Trump and Biden support eliminating surprise bills but haven’t provided any details how. That “how” is important, as hospitals and payers support wildly different solutions.

Biden

Biden also has a long list​ of proposals to curb drug costs, including allowing the federal government to negotiate directly with drug manufacturers on behalf of Medicare and some other public and private purchasers, with prices capped at the level paid by other wealthy countries. Trump actually supported this proposal in his 2016 campaign, but quickly dropped it amid fierce opposition from drugmakers and free market Republican allies.

Biden would also cap out-of-pocket drug costs in Medicare Part D — but wouldn’t ban rebates, as of his current plan, allow consumers to import drugs (subject to safeguards) and eliminate tax breaks for drug advertising expenses.

He would also prohibit prices for all brand-name and some generic drugs from rising faster than inflation under Medicare and his novel public option. Biden would create a board to assess the value of new drugs and recommend a market-based price, in a model that’s shown some efficacy in other wealthy countries like Germany.

Both Biden and Trump say they support developing alternative payment models to lower costs. But they diverge on the role of competition versus transparency in making healthcare more affordable. In a rule currently being challenged in court, Trump’s HHS required hospitals to disclose private negotiated prices between hospitals and insurers, with the hope price transparency will allow consumers to shop between different care sites and shame companies into lowering their prices.

Biden, by comparison, says he would enforce antitrust laws to prevent anti-competitive healthcare consolidations, and other business practices that jack up spending. Trump has been mum on the role of M&A in driving healthcare costs, and inherited a complacent Federal Trade Commission that’s done little to reduce provider consolidation. Until a contentious hospital merger in February this year, the FTC hadn’t opposed a hospital merger since 2016.

 

 

 

 

FTC expands retrospective scrutiny of mergers

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/ftc-expands-retrospective-scrutiny-of-mergers.html?utm_medium=email

Federal Trade Commission (FTC) Definition

The Federal Trade Commission is expanding its retrospective review of mergers and acquisitions, using data from before and after a deal to assess whether the transaction affected prices, quality and consumer choice. 

The FTC has retrospectively reviewed mergers since 1984. The two goals of the program are to understand whether the agency’s threshold for bringing an enforcement action in a merger case has been too permissive and to assess the performance of tools that FTC economists use to predict the effects of proposed mergers.

The expanded program means the agency will dedicate more time and resources to studying completed mergers, addressing antitrust questions that have not been extensively studied in previous years and expanding retrospective reviews to industries that have not been studied.

Compared to other industries, healthcare mergers have undergone extensive scrutiny under the retrospective review program, with eight studies since 2011. These retrospective analyses have proven influential to federal challenges of subsequent healthcare mergers: The FTC was able to challenge 13 hospital cases from 2008 to 2018.

As part of the expanded program, the FTC director of the bureau of economics will release an annual summary on lessons and findings from the retrospective studies.

 

 

 

 

Amazon Is Hiring an Intelligence Analyst to Track ‘Labor Organizing Threats’

https://www.vice.com/en_us/article/qj4aqw/amazon-hiring-intelligence-analyst-to-track-labor-organizing-threats?fbclid=IwAR2HPsGNDFctpmNzBb_6Su9yof5SN_ke-E9cG0vHwgseLJw8UaQmarmGoPk

Amazon is looking to hire two people who can focus on keeping tabs on labor activists within the company.

Amazon is looking to hire two intelligence analysts to track “labor organizing threats” within the company.

The company recently posted two job listings for analysts that can keep an eye on sensitive and confidential topics “including labor organizing threats against the company.” Amazon is looking to hire an “Intelligence Analyst” and a “Sr Intelligence Analyst” for its Global Security Operations’ (GSO) Global Intelligence Program (GIP), the team that’s responsible for physical and corporate security operations such as insider threats and industrial espionage. 

The job ads list several kinds of threats, such as “protests, geopolitical crises, conflicts impacting operations,” but focuses on “organized labor” in particular, mentioning it three times in one of the listings. 

Amazon has historically been hostile to workers attempting to form a union or organize any kind of collective action. Last year, an Amazon spokesperson accused unions of exploiting Prime Day “to raise awareness to their cause” and increase membership dues. Earlier this year, the company fired Christian Smalls, a Black employee who led a protest at a fulfillment center in New York over Amazon’s inadequate safety measures in the early days of the COVID-19 pandemic. During a meeting with Amazon CEO Jeff Bezos, company executives discussed plans to smear Smalls calling him “not smart, or articulate.”  

These job listings show Amazon sees labor organizing as one of the biggest threats to its existence.

Do you work at Amazon, did you used to, or do you know anything else about the company? We’d love to hear from you. Using a non-work phone or computer, you can contact Lorenzo Franceschi-Bicchierai securely on Signal at +1 917 257 1382, on Wickr at lorenzofb, OTR chat at lorenzofb@jabber.ccc.de, or email lorenzofb@vice.com.

After this story was published, Amazon deleted the job listings and company spokesperson Maria Boschetti said in an email that “the job post was not an accurate description of the role— it was made in error and has since been corrected.” The spokesperson did not respond to follow-up questions about the alleged mistake. The job listing, according to Amazon’s own job portal, had been up since January 6, 2020.

Dania Rajendra, the Director of the Athena Coalition, an alliance of dozens of grassroots labor groups that organize amazon workers, criticized the listing.

“Workers, especially Black workers, have been telling us all for months that Amazon is targeting them for speaking out. This job description is proof that Amazon intends to continue on this course,” Rajendra told Motherboard in a statement. “The public deserves to know whether Amazon will continue to fill these positions, even if they’re no longer publicly posted.”

On Monday, the Open Markets Institute, a nonprofit that studies monopolies, published a report on Amazon’s employee surveillance efforts, claiming that these practices “create a harsh and dehumanizing working environment that produces a constant state of fear, as well as physical and mental anguish.” 

After a week of the jobs being posted online, 71 people have applied to the Intelligence Analyst position, and 24 people to the Sr Intelligence Analyst job, according to Linkedin. The first job was posted in the Amazon Jobs portal in January, the second job on July 21, according to the company’s site.

UPDATE Sept. 1, 12:04 p.m. ET: Shortly after this story was published, Amazon removed the listings from its job portal.

 

 

 

 

Cartoon – Modern Health Policy

MSSNYeNews: October 18, 2019 - Foul Turns FairMSSNYeNews Surprise Medical  Bills -

American patients can’t shop their way to a low cost healthcare system

American patients can’t shop their way to a low cost healthcare system

Hospital price transparency is a distraction from policies that could reduce costs without burdening patients, say Jamie Daw and Adam Sacarny.

 

The prices that hospitals charge privately insured patients in the US have long been shrouded in secrecy. These prices—which are negotiated between hospitals and private insurers—vary widely: the price for the same blood test could vary 39-fold within Tampa, Florida and the cost of a cesarean delivery varies by up to $24 000 in San Francisco, California.

A recent federal court decision stands to shine a light on opaque hospital pricing in the US. In a lawsuit brought forward by the American Hospital Association, a federal judge upheld a regulation issued by the Trump administration that will soon require hospitals to post a wealth of information on payment rates online.

This policy seems intuitive: in other sectors of the economy, consumers usually know the price of a service or product before they purchase it. By comparing prices, consumers can shop around and save money. In turn, sellers anticipate that behavior and are incentivized to keep prices low. Who wouldn’t want a virtuous circle like that in healthcare? 

The Trump administration argues that hospital price transparency will encourage value in healthcare by helping patients and employers find lower prices, while pressuring hospitals to cut them further. However, the potential effects—and who stands to benefit—are not so straightforward.

 

Firstly, giving consumers information on prices doesn’t necessarily mean that they will respond by seeking lower cost services. Studies have consistently found that patients tend not to use price transparency tools, and their effects on healthcare spending are small or nonexistent. Why? Shopping for healthcare services is often complicated or impossible. 

 

Many of the most expensive services are for emergencies where there is little scope for patients to shop.

Even when a patient has time to compare prices for non-urgent procedures or tests, the complexity of healthcare payment systems and insurance products makes it next to impossible for a patient to preemptively calculate what they would personally pay for an encounter. Establishing that amount requires patients to know the cost-sharing parameters of their insurance plan, the set of services they will use during the encounter, and how aggressively the hospital will bill for those services.

Insurance also obscures patients’ incentives to shop by insulating them from healthcare prices.

While patients can be given strong incentives to shop—and an increasing number of American workers are enrolled in high deductible health plans with this aim—these incentives are created by hoisting financial risk on patients. This financially burdens American families and can result in patients forgoing appropriate care.

 

Beyond the challenges posed by patient shopping, the empirical evidence supporting price transparency is weak.

It could even backfire. Economists have pointed out that in sectors with low competition, price transparency can facilitate collusion and lead to higher prices. This fear was borne out in Denmark when authorities began publishing the prices of ready-mixed cement. Prices proceeded to converge and rise, and the authorities eventually abandoned the idea. The most hopeful evidence in the US healthcare system comes from New Hampshire, where prices for medical imaging fell by 3% after the state established a price transparency website. But even effects of this magnitude, while beneficial, would only make a tiny dent in lowering US healthcare costs. 

 

Price transparency efforts reflect a broad trend for American policy makers to turn to consumer-driven strategies to reduce healthcare costs.

These strategies are built on the assumption that patients ought to be responsible for navigating their way to high quality, low cost healthcare. However, the challenges faced by patients in assessing the complex cost-quality tradeoffs in healthcare limit the potential for price transparency to have the impact that the administration advertises.

Perhaps more troubling is that these efforts could distract policy makers from addressing the main drivers of US healthcare prices, such as rapid and ongoing consolidation. Concentrated hospital markets are becoming the norm in the US and are strongly associated with higher prices. Antitrust actions, such as preventing hospital mergers, could reduce and reverse consolidation, likely leading to lower prices.

Another option for policy makers is to assume a greater regulatory role over healthcare prices, including introducing price caps and an all-payer rate setting. A Supreme Court decision made it much more difficult for state governments to collect the data that would undergird these efforts. As a result, the information released under the transparency rule may end up being more useful for states considering new price regulations than for patients shopping for healthcare services.

 

If we want to reduce prices without burdening patients with financial risk, then policy makers need to address the emerging causes of rising healthcare costs directly. Efforts to control costs are most likely to succeed when policy makers tackle the structural drivers behind the most expensive health system in the world.

 

 

 

 

Sutter loses bid to delay $575M antitrust settlement approval

https://www.healthcaredive.com/news/sutter-loses-bid-to-delay-575m-antitrust-settlement-approval/581393/

Dive Brief:

  • A San Francisco Superior Court judge on Thursday denied Sutter Health’s request to delay preliminary approval of a $575 million antitrust settlement with California amid the uncertainty and financial upheaval of the COVID-19 pandemic.
  • The approval process and settlement agreement are flexible enough to continue as scheduled and the needs of the plaintiffs — a union that operates a trust for employee healthcare benefits and California Attorney General Xavier Becerra — to see the health system’s behavior change are pressing, Judge Anne-Christine Massullo wrote in her order.
  • In a statement Thursday, Becerra applauded the court’s decision. “Sutter’s practices harmed California’s healthcare market by charging higher prices unrelated to quality or cost of care,” he said. “They did that long before the COVID-19 pandemic. There is no period of time that medical providers, like Sutter, should be able to carry out such destructive market practices.”

Dive Insight:

Sutter, like health systems throughout the country, has taken a significant hit to its bottom line as the pandemic forced lucrative elective procedures to be put off for weeks earlier this year. The company posted a net loss of more than $1 billion in the first quarter of this year.

It said the financial losses from the COVID-19 crisis could force it to close or divest hospitals. In its June argument to delay the settlement approval, Sutter said the agreement’s cap or chargemaster prices could be too low “to cover the unprecedented and unforeseeable increases in expenditures to respond to COVID-19 particularly given declining revenue.”

But the judge did not agree, saying the court is “not persuaded that the proposed injunction will interfere with Sutter’s ability, or the broader healthcare system’s ability, to provide patient care during the COVID-19 pandemic.”

Massullo continued: “To the extent that a provision of the proposed injunction poses a threat to patient care or the public interest during the COVID-19 pandemic, or as a result of some other presently unforeseen circumstance, any party may seek a modification of the offending provision if and when such a modification becomes appropriate.”

The preliminary approval hearing is now set for Aug. 12 and Aug. 13, according to multiple news reports.

Sutter avoided a jury trial late last year by agreeing to the settlement, which in addition to the $575 million payout includes stipulations like ceasing contracts that require all of its facilities be in an insurer’s network or none of them. The system, however, did not admit guilt as part of the agreement.

 

 

 

FTC, Justice Department have new guidelines for vertical mergers

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/ftc-justice-department-have-new-guidelines-for-vertical-mergers.html?utm_medium=email

Trump Administration Updates Vertical Merger Guidelines - Multichannel

Guidance on vertical mergers got its first major overhaul from the Federal Trade Commission and the U.S. Department of Justice in more than 35 years under new joint guidelines published June 30.

Vertical mergers are those that combine firms or assets at different stages of the same supply chain, such as healthcare company CVS Health’s acquisition of insurer Aetna. Previously proposed mergers like that of insurers Humana and Aetna would be considered horizontal.

FTC Chairman Joe Simon said in a news release that the new guidances “are an important step forward in maintaining vigorous antitrust enforcement, and reaffirm our commitment to challenge vertical mergers that are anticompetitive and would harm American consumers.”

Leaders said that the guidelines explain FTC and Justice Department investigative practices and will give the business community clarity about antitrust concerns, such as the type of evidence the FTC and Justice Department review and how they define markets.

To read the full guidelines, click here