States encourage hospital mergers but the feds are casting wary eye..

 

As federal policymakers step up oversight of hospital mergers, more states are taking steps to encourage consolidation in the industry — or to have the final say on whether such moves are anti-competitive.

The policies are a sign of the power some hospital lobbies continue to wield in statehouses, where they've argued mergers are a way to expand the patient base and keep otherwise unprofitable facilities open.

State sovereignty is in play in these discussions, especially around the question of whether states have the authority to exempt hospitals from federal antitrust scrutiny.

Research shows that acquisitions can keep rural facilities open, but that facilities usually wind up cutting services that community members rely on. Mergers can also slow wage growth for health care workers.

Harold Miller, president of the Center for Healthcare Quality and Payment Reform said "there are other ways for rural hospitals to be paid more by health plans or have access to more capital."