How to track the health care consolidation trend in your community

Published on
November 17, 2016

Health care providers are consolidating throughout the country, impacting how much care costs, how it’s delivered and how it’s accessed.

Consolidation is a trend that has taken place for some time, and has picked up pace in recent years. Some instances of consolidation are of the horizontal nature, where hospitals acquire other hospitals, while some are examples of vertical integration, in which hospitals and outpatient providers are combined. 

As I wrote about in my 2016 California Fellowship series, regulators are weighing the proposal from two major health care nonprofit providers in Santa Barbara County — Cottage Health, which includes three hospitals and the sole hospital in the county, and Sansum Clinic, a network of 26 outpatient clinics.

The providers claim they would work better together by creating an accountable care organization — touted by the Affordable Care Act — that would streamline delivery and reduce costs. Critics are concerned that a vertically integrated organization would increase the combined organization’s bargaining power with insurers, which would lead to increased costs. Independent physicians are worried they would get squeezed out of the market, which could reduce access to care.

But given the tight-lipped nature of the Federal Trade Commission’s antitrust investigations, there has not been much reporting on the proposal and the public conversation has been limited.

At the Pacific Coast Business Times, we came out with a series of three stories: the history of the organizations and how they charted a path to become one; how a merger would impact cost and access; and how regulators have ruled on past vertical integrations.

The projects were prominently featured on the front page of our weekly publication, as we strived to inform a thoughtful conversation. We also featured the stories on our NPR affiliate in Thousand Oaks, KCLU, and the patient advocate organization AdvoConnection sent out the story links in its email to members.

Our readers seemed to particularly respond to a patient I featured in my second story of the series who had “sticker-shock” after receiving her hospital bill following a trip to the ER. Many could relate to her story.

I found it was important to be relentless. I contacted about two dozen patient advocates to try to connect with patients who would talk about their experience in our health care system. I reached out to about 10 bankruptcy lawyers and a handful of doctors to try to find a patient who would talk on the record. I called dozens of local residents by poring through lawsuits filed against the organizations and tracking down the individuals who lodged the complaints in the phone book. I spent hours outside of the hospital’s third-party debt collection agency trying to find a patient who would talk.

Here’s some advice for reporters covering health care mergers:

  • Familiarize yourself with the datasets provided by the Office of Statewide Health Planning and Development to track annual cost trends.
  • Use Medicare data provided by CMS to find out what hospitals charged versus what Medicare paid.
  • Patient advocates can be good resources for sourcing.
  • Tap the knowledge of professors who study economics and health care policies.
  • Study lawsuits that have been filed against one of the organizations — the lawyers on record can provide background information on antitrust law.
  • Note the other merger proposals the Federal Trade Commission has investigated.
  • Subscribe to daily Modern Healthcare and California Healthline newsletters to stay up to date.
  • Medical debt is often the leading cause of bankruptcies. Head to your local bankruptcy lawyers or court to find individual examples of patients with medical debt.
  • If it’s a nonprofit provider, go through its IRS 990 Forms to track executive salaries, revenues, charitable care and bad debt.
  • The Association of Health Care Journalists is a great resource for sourcing, studies on health care policy and trends, and has a broad listserv that you can bounce inquiries off of.
  • Assemble an email list of organizations and individuals who are impacted by changes in the health care system who will share your stories.