Hospital Monopolies the Biggest Cause of Healthcare Cost Increase

For years certain interests have worked to convince Americans that medical malpractice lawsuits are of the main reason why healthcare costs have increased. Our Illinois medical malpractice attorneys know full well that the claims made about these lawsuits are dramatically overblown, as research continues to explain how even the most draconian “tort reform” efforts have next to no effect on these expenses. Instead the unfortunate rise in medical costs are being used by deep-pocket interest groups as an opportunity to use misdirection to take away the legal rights of average consumers so that their profit margins can increase even more. We must do everything in our power to fight these untrue and unfair attempts to undermine the justice system.

It is also helpful to spread information about the true causes of price increases. For example, Forbes reported today on one of the main problems: hospital monopolies. The author explained that-far from limiting the rights of medical malpractice victims-one of the main ways to lower costs is to change the way that healthcare is sold. Previously consumers (and health insurance providers) could work to essentially “shop around” and ensure that those healthcare professionals who charged less for certain services received more patients. In this way the market system was allowed to work to balance medical quality and costs.

However, all of that changes when those once-competing hospitals merge into one. When that occurs the medical providers take all of the leverage and can charge whatever price it wants for certain services. These large healthcare monopolies can essentially strong-arm smaller competition and insurers into doing what they want, which includes accepting higher costs.

Many advocates believe that governments need to do more to combat these strong-arm tactics. There are some signs that public bodies are doing just that. For example, the Department of Justice has opened an investigation into anticompetitive behavior of the Boston-based Partner’s Healthcare. Similarly, the Federal Trade Commission recently began challenging a merger between two Toledo hospitals after the newly merged business immediately began increasing rates. As soon as the merger was finalized the companies went to insurers to demand higher reimbursement rates which are then passed onto consumers who will have higher premiums.

However, much work still needs to be one before the situation is adequately addresses. Some advocates explain that stronger doctor-hospital alliances-known as “accountable care organizations”-may make the problem worse. These partnerships can strengthen the medical provider’s bargaining power even more, allowing these conglomerates near unchecked power to charge whatever rates they want in a certain region.

Far too many area residents struggle each day to afford basis health coverage. It is important for all steps be taken to investigate how to bring down these often staggering costs. In our area any experienced Illinois medical malpractice attorney knows that lawsuits are not the problem. Instead, it is helpful to focus on systematic problems relate to the sale of that care. This includes working to ensure large medical monopolies do not unfairly strong-arm the market and use their power to force higher rates upon community members.

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