Must-Read: Michael Hiltzik: Mergers in the Healthcare Sector: Why You’ll Pay More
Must-Read: Because people must purchase health insurance under ObamaCare, the demand curve has a steeper slope–and thus oligopoly and monopoly are even more dangerous and destructive than they typically are:
: Mergers in the Healthcare Sector: Why You’ll Pay More: “Aetna is seeking to merge with Humana in one of the two proposed health insurance mega-mergers facing state and federal scrutiny…
…the other deal would combine Anthem and Cigna. Lower prices. More efficient healthcare. More innovation. Better customer service. That’s what hospital and insurance companies say, anyway. But here’s what the data say: Hospital and insurance mergers almost always lead to higher costs, lower efficiencies and less innovation. The reason is simple: Mergers reduce competition–and it’s competition that drives down prices and encourages more efficiency and innovation. Some healthcare mergers have been outright disasters for consumers; studies of mergers that took place in the 1990s and early 2000s showed price increases of as much as 40% in communities that lost competition. These findings are important because we are deep into a new era of healthcare consolidation. In 2015, 112 hospital mergers were announced nationwide; that’s 18% more than a year earlier, and a 70% increase over 2010…