State Strategies to Address Rising Prices Caused by Health Care Consolidations

Foreward by Trish Riley, NASHP Executive Director

The debate over the future of the Affordable Care Act (ACA) and the stability of the individual health insurance markets masks a bigger issue–the underlying cost of health care. From NASHP’s Center for State Rx Drug Pricing to our work on value-based purchasing and alternative payment methods, we support states as they take on this difficult and important work to lower the health care cost trajectory.

We are pleased to release a provocative report we commissioned that addresses a key cost driver in health care–provider consolidation. This paper explores the rapid increase in consolidation of hospitals and provider groups and mergers across geographic markets that have resulted in double-digit price increases in the single largest sector of health care spending.

This is a particularly challenging issue. On the one hand, states have supported provider mergers to create integrated, patient-centered care. On the other hand, these consolidations are clearly driving prices higher with little evidence of improved quality, according to our consultant Erin Fuse Brown, JD, MPH, who introduced this topic at NASHP’s 2015 annual conference.

In this report, she presents a range of strategies states can pursue, including revisiting what we think about certificate of need laws, insurance rate regulation, provider and accountable care organization certification and licensure, and global budgets. She lays out a clear path states can follow to achieve quality care at fair prices.

Please let us know what you think. NASHP will keep this issue on the front burner and wants to hear how we can help your state develop real solutions to the vexing problem of health care consolidation.

Full Report: State Strategies to Address Rising Prices Caused by Health Care Consolidations