Within a week after CVS Health confirmed it would buy health insurer Aetna, a flurry of Catholic-owned and other faith-based nonprofit hospital operators are looking to create national and regional health system giants.
It’s the kind of consolidation of hospital systems that will only accelerate as they protect their turf from the coming invasion of CVS Health and Optum, the medical care provider unit of UnitedHealth Group. Both CVS and Optum plan to expand outpatient services by acquiring and developing doctor clinics, health centers and other low-cost providers.
What was once a nation of more than 5,000 independent community hospitals and academic medical centers is quickly turning into a small number of regional behemoths controlling dozens of hospitals and hundreds of outpatient clinics. The combination of California-based Dignity Health and Colorado-based Catholic Health Initiatives will control 700 sites of care and 139 hospitals while the proposed combination of Chicago’s Advocate Health Care and Milwaukee’s Aurora Health Care will operate 27 hospitals and more than 500 sites of care. And the Wall Street Journal reported Sunday that Ascension and Providence St. Joseph Health would create an even larger nonprofit health system with 197 hospitals in 27 states.
Excerpt from Hospitals Merge To Protect Turf As CVS And Optum Move In in Forbes
A big shift is under way. The last year was filled with mega mergers of hospital networks, outpatient clinics, and other provider services. The Wall Street Journal recently reported that these mergers will, in large part, “accelerate the shift in how and where Americans get medical care — away from hospitals and toward clinics, doctors' offices, surgery centers and even drugstores.” Cost containment, the essential tenet of managed care, is driving these investments in outpatient care. Vera’s experience also shows that shifting care from hospitals to outpatient settings contains costs, but only if future care occurs in the right outpatient settings. For employer-sponsored benefit strategies, primary care on-site clinics should be an essential part of this shift. Here's why:
- Unlike urgent care or drugstore healthcare, on-site clinics have providers that invest the necessary time to build long-term relationships with patients that will help them identify core problems and seek long-term health.
- On-site clinics are the ideal point of care for a managed care approach because they can be the central point of coordination for ongoing care.
What do you think about the push to move more and more services out of hospitals?