Hospitals, doctors and insurers feeling the market’s force

One big hospital, St. Luke’s, has come to dominate the health-care marketplace in Boise, Idaho, according to an article in The New York Times by Julie Creswell and Reed Abelson, and other cities and regions are experiencing similar consolidations.

“A little over half of the 1,400 doctors in southwestern Idaho are employed by St. Luke’s or its smaller competitor, St. Alphonsus Regional Medical Center,” says the article, “A Hospital War Reflects the Bind for Doctors in the U.S.”

“Many of the independent doctors complain that both hospitals, but especially St. Luke’s, have too much power over every aspect of the medical pipeline, dictating which tests and procedures to perform, how much to charge and which patients to admit.

“In interviews, they said their referrals from doctors now employed by St. Luke’s had dropped sharply, while patients, in many cases, were paying more there for the same level of treatment.”

The trend toward consolidation, seen especially in places where doctor practices have been purchased by hospitals or combined into big groups with a lot of market power, has many causes: the complexity of billing, an epochal change inside the health-care industry, some of the legislative aspects of the health-care reform law, and various other marketplace, judicial and legislative factors. It’s a topic well worth reading about, and this is a terrific story

“Boise’s experience reflects a growing national trend toward consolidation. Across the country, doctors


who sold their practices and signed on as employees have similar criticisms. In lawsuits and interviews, they describe growing pressure to meet the financial goals of their new employers — often by performing unnecessary tests and procedures or by admitting patients who do not need a hospital stay.”

As always with The Times, when the comments are turned on and moderated, the information from commenters is terrific. Don’t miss them.

As the piece was being published, the American Medical Association and the big insurance trade group America’s Health Insurance Plans crossed swords.

“Lack of competition among managed care plans is resulting in increased premiums for diluted benefits and is hurting both patients and physicians, says the American Medical Association in its updated analysis of the health insurance market,” writes  Rachael Zimlich in Modern Medicine.

“The annual study, Competition in Health Insurance: A Comprehensive Study of U.S. Markets, has drawn criticism from the trade association America’s Health Insurance Plans (AHIP).

” ‘This is the same fatally flawed study that has consistently been debunked by leading healthcare economists,’ AHIP says in a statement about the report, noting that the study omits data from certain markets, such as self-insured health plans. ‘Families and employers in every state have multiple choices of both insurance plans and types of coverage. Moreover, research clearly demonstrates that provider consolidation—not concentration of health plan markets—is driving up healthcare costs for consumers and employers.’ ”