Hospital Consolidation Has Been Bad for England

[B]etween 1997 and 2006 in England around half the short term general hospitals were involved in a merger … [These mergers are initiated by a regulator, acting on behalf of the public, and justified on the grounds that merger will improve outcomes.] …  We examine the impact of mergers on a large set of outcomes including financial performance, productivity, waiting times and clinical quality and find little evidence that mergers achieved gains other than a reduction in activity.  In addition, mergers reduce the scope for competition between hospitals.

Source: NBER study

Comments (5)

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  1. Joe S. says:

    There are lessons for the USA in here.

  2. Ken says:

    Joe, the most important lesson is that the consolidation Obama Care is encouraging is going to make us all worse off.

  3. Devon Herrick says:

    There are generally only a few hospitals in an urban region and a handful of insurers paying them. In the absence of price competition for numerous cash-paying patients, hospital consolidation has meant rising prices.

  4. Brian says:

    If prices rise enough, some will call for some unspecified future merger to be blocked.

  5. Alex says:

    Also, consolidation usually reduces healthcare locations – this can leave large, rural areas without reasonable access to regular healthcare.