Recent policy insights on health systems
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Periodic updates to Congress on RAND’s work in health | Web version
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Congressional Newsletter
August 4, 2021
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Impacts of Consolidation and Integration on Health Systems
Public attention and regulatory scrutiny are increasingly focused on health care consolidation—both horizontal (hospitals acquiring other hospitals) and vertical (for example: hospitals acquiring physician practices). A growing body of research sheds light on whether integration represents a value add to U.S. health care.
The RAND Center of Excellence on Health System Performance, a collaboration of the RAND Corporation, Pennsylvania State University, UCLA, Stanford, and Harvard, has been investigating changes in health systems—such as increased consolidation, greater integration among hospitals and physician organizations, and the growth of health information technology (IT) capabilities—seeking to understand how these changes may affect the ability of U.S. health systems to achieve high-quality care at lower costs. The findings below are from a body of newly released RAND Center research.
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PeopleImages/Getty Images
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Researchers’ examination of the effects of vertical integration on referrals and spending for high-volume services found that changes in referral patterns for five common diagnostic imaging and lab procedures triggered an increase in Medicare spending of $73.1 million over a three-year period. Additionally, they found that over time, more physician groups have become integrated with hospitals or health systems (increasing consolidation in the marketplace), more physicians work in vertically integrated groups, and more Medicare beneficiaries are directly affected by vertical integration.
Read more here »
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bluejayphoto/Getty Images
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Researchers looked at clinically integrated networks (CINs)—health care organizations and private practice physicians that contract together to provide care jointly and share profits but do not formally merge—as part of a larger study to identify the characteristics of high-performing health systems. They suggest that the debate about the effects of health care consolidation should be expanded to include a focus on CINs, as they also represent a potential threat to increased prices and health spending without a proportionate impact on quality of care.
Read more here »
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Other new policy insight papers synthesize what we’ve learned about
Please contact me if you would like to schedule a meeting to discuss any of the research above.
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RAND Congressional Resources Staff
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