But if that were true, wouldn't we be seeing more activity by antitrust authorities? We're not.
The evidence continues to mount that consolidation is facilitating the move toward accountable care. Last week, the government reported that healthcare spending in the first quarter—the first period when Obamacare enrollees had access to coverage—fell by 1.4% on an annualized basis, not the nearly 10% increase that economists had expected.
There have been a dozen quarters in the past half century when spending actually fell before reverting to its upward trajectory. Downbeat economists offered “special circumstances” to explain why last quarter's results will prove to be the same: the harsh winter, the late rush in exchange enrollment, the rise of high-deductible plans that may be driving people to reconsider or postpone care.
But the slowdown in spending predated those circumstances. Indeed, we're now in the fourth straight year of moderate healthcare spending growth. The growth spurt that's just around the corner is beginning to look like the proverbial light at the end of the tunnel.
The question for providers now—at least those who are delivering improved population health management while reaping the perverse reward of declining admissions—is how can they begin to capture some of the added value they are creating by keeping healthcare spending in check.
That's where the final piece of the integration puzzle comes in. The boldest provider organizations are expanding their efforts to assume financial risk for the populations whose health they manage. The role models are well known: Kaiser Permanente, Geisinger Health System, GroupHealth Cooperative in Seattle. They not only offer integrated delivery networks, but the insurance products that pay for them.
By being both payer and provider, systems get to keep the immediate savings that come from reduced spending. That, hopefully, will create the virtuous circle where integrated organizations can continue to keep costs in check while delivering better health and better health outcomes for patients and consumers.
One of the more interesting presentations at HFMA ANI last week showcased two mid-sized healthcare systems—one in Florida and one in Ohio—that were expanding their insurance arms. One said it now provides coverage for about 20% of its system's patients. When it gets to 40%, he said, “Our hospitals become a cost center, not a revenue driver.”
That's a very different world from where healthcare is today. But it is where healthcare is headed.
Follow Merrill Goozner on Twitter: @MHgoozner