A lack of competition in the large US hospital market is driving up healthcare costs for individuals and families. And Congress can do something about it.
In 2020, Americans estimate Healthcare spending is $4.1 trillion, with hospitals accounting for the largest share. $1.3 trillion. Medicare and Medicaid Service Centers (CMS) Estimate Hospital spending increased by 6.9% this year, well ahead of the projected growth of the domestic economy.
High hospital bills are not always worth the medical bills.
In most metropolitan markets, healthcare is A few hospital corporations. Based on Federal Trade Commission (FTC) indicators, 90 percent The hospital market is concentrated in the major metropolitan statistical areas of the United States. These large hospital systems are also acquiring private medical practices.currently owned by hospitals and other companies almost half of all physician practice.
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Independent medical practice, the birthplace of the traditional doctor-patient relationship, is rapidly disappearing.
This concentration of economic power is costly and has undesirable consequences.According to a recent American Enterprise Institute report, the lack of competition in hospitals not only contributes to rising medical costs, and thus insurance premiums. It also results in less patient choice, less innovation in care delivery, and suboptimal quality measurements. To put it bluntly, patients are suffering.
Government policy is driving this trend, and government policy (state and federal) can reverse it.Researcher at Land Corporation report Government policies to increase competition and deconcentrate the hospital market could cut annual hospital spending by about $6.2 billion and $68.9 billion, depending on the “scale” of the change.
wide state Authority over care access and delivery has numerous policy options for improving competition and providing affordable care. One of the most effective: Reform or Abolish Certificate of Need (CON) law, which requires medical professionals to obtain state permission to build or expand medical facilities. Both the Federal Trade Commission and the Justice Department, under both Democratic and Republican administrations, Identified These state laws are anti-competitive and create barriers to market entry without improving quality or reducing costs.
parliament too 3 big steps Expand the hospital market and improve patient access to more affordable, quality care.
First, Congress could remove legal restrictions on Medicare and Medicaid payments to doctor-owned hospitals, including hospitals that specialize in areas such as heart, cancer, and orthopedics. Enacted in 2010 as part of the Affordable Care Act, the restrictions deprive these hospitals of the large federal health care costs that flow into the larger hospital system, putting them at a serious competitive disadvantage. is placed in
a Main literature review A study conducted by analysts at George Mason University’s Mercatus Center demonstrated that physician-owned hospitals provide better quality care at lower or “comparable” costs. Obamacare’s payment limits put these hospitals in financial trouble and pose a significant barrier to other hospitals entering the market. The Health Policy Consensus Group endorsed the removal of restrictions, and Rep. Victoria Spartz (R-Ind.) introduced legislation (Flexibility of hospital ownership laws) does exactly that.
Second, Congress could make Medicare payments for medical services “site neutral.” Today, Medicare typically pays health care professionals more when services are provided in hospitals rather than clinics and clinics. by paying the same price for Quote It will save taxpayers $63.2 billion over 10 years.
Medicare is the nation’s largest payer of health insurance, so “site neutrality” payments will have a positive knock-on effect in the private market, increasing provider competition and reducing patient costs. This policy has bipartisan potential.it is supported by liberals the brookings institute Scholar and Conservative Health Policy Consensus Group and embodied Hospital billing law transparencywhich was also proposed by Rep. Spartz.
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Finally, Congress can codify price transparency rules for federal hospitals. Patients and their families are often shocked. The cost of common medical procedures provided by hospitals. This is because hospitals do not disclose prices up front. Bills for common procedures (such as hip and knee replacements) can vary by thousands of dollars, even between hospitals within the same geographic region.
To address this issue, the Trump administration has announced Key Hospital Price Transparency Rules for 2019. Hospitals are required to post information for 300 “purchasable” medical procedures with the goal of providing easily accessible hospital pricing information to patients. The Biden administration also accepted this rule.
Initial compliance with the rules was slow and spotty, but it is improving.
Congress could further improve policy by codifying rules and standardizing pricing formats report and require hospitals to post quality measures developed by state or private sector consumer groups. Bipartisan congressional support is not out of the question. For example, last year, House Energy and Commerce Committee Chairman Frank Pallone (DN.J.) and ranking member Cathy McMorris Rogers (Republican) advocated for harsher penalties About hospitals that don’t follow the rules.
Congress should focus on fixing the dysfunctional hospital market in 2023. Congress should adopt procompetitive strategies instead of enacting policies such as price controls that further distort markets. Representatives and senators will work together to increase transparency in hospital pricing and performance, remove restrictions on physician-owned specialty hospitals, and establish competitive medical specialty hospitals with hospitals through “site-neutral” Medicare payments. Real progress can be made by working together to level the playing field between homes.
