The Aug. 1 cover story “For health systems, how big is too big??”, starts with a flawed premise and then searches for validation. Unfortunately, while the article considers many factors, it falls short in offering a thorough analysis of what successful integration actually looks like. It also downplays the fact that many larger systems weathered the COVID-19 pandemic more effectively than smaller ones, with clear benefits to patients and communities.
The article appears to cherry-pick 10 mergers between 2010 and 2019 without any explanation as to why they were chosen to evaluate post-merger costs. By contrast, last year’s study by Charles River Associates of 144 hospital mergers found a statistically significant 3.3% reduction in annual operating expense per adjusted admission, along with other related benefits.
Also missing was an acknowledgment that mergers can achieve other benefits beyond scale or cost efficiencies, such as bringing new services to patients. An analysis by Kaufman, Hall & Associates last year found that nearly 4 in 10 acquired hospitals added one or more services after the acquisition. Moreover, patients at hospitals acquired by academic medical centers or large health systems also gain access to more advanced and specialized care.
Lastly, the article rightly points out that achieving goals after a merger varies. Indeed, hospitals may choose to merge for a variety of reasons, and integration can lead to meaningful and varied benefits for patients and communities.
Rick Pollack, president and CEO, American Hospital Association
