Hospital industry makes case for lifting of antitrust restrictions

The American Hospital Association released a study by the consulting firm Compass Lexecon on Tuesday questioning whether hospital consolidations are causing prices to rise.

The release of the study coincides with a day-long Federal Trade Commission workshop focusing on Accountable Care Organizations, which are arrangements encouraged by the healthcare reform law that require closer integration between doctors and hospitals to promote efficiency. Hospitals worry that ACOs could run afoul of federal antitrust restrictions and want these to be relaxed, but critics counter that doing so could lead to ever higher prices for consumers as the healthcare sector continues to consolidate.

Tuesday's report criticizes two studies that have been "widely cited as support for limiting caregivers' flexibility to develop or expand clinical arrangements integration arrangements with exaggerated claims of provider market power," according to an executive summary of the report.

Compass Lexecon examined two studies linking hospital market power to rising prices: one about California healthcare providers in the April 2010 issue of Health Affairs, the other a 2010 survey of healthcare costs by the Massachusetts Attorney General. The consultants' conclusion: "neither publication lends any credible support for such claims."