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Hospital Price Skirmishes vs. Solidarity-Driven Transformation

Summary: In Connecticut, a large hospital system is being sued to stop anti-competitive practices that raise prices for insurers, employers, and patients. Good, as far as it goes. But it’s just minor tweaking of a profoundly dysfunctional market-based system. Where’s the needed transformation?

Patients are coming after hospital monopolies
AXIOS
Feb 16, 2022
By Bob Herman

A group of citizens in Connecticut is suing Hartford HealthCare, alleging the large hospital system has amassed monopoly power “to extract higher prices from insurers, employers, and patients.”

Why it matters: This is another class-action lawsuit arguing hospital consolidation has crushed everyone’s bank accounts and has led to the rise of anti-competitive contracts that force insurers and employers to accept take-it-or-leave-it terms.

“Even if you don’t live in Connecticut, you should be worried about [these hospital behaviors], because you’re paying for this through your insurer,” said Ellen Andrews, head of the consumer advocacy group CT Health Policy Project.

Driving the news: People with commercial insurance in Connecticut allege Hartford HealthCare, a $5 billion hospital system, has scooped up hospitals throughout the state and rolled that leverage into insurance contracts, including:

“All-or-nothing” contracts. Insurers exclude hospitals from networks if hospitals have lower quality or higher prices, but Hartford allegedly required insurers to include all of its hospitals — including more expensive ones in more competitive areas — in networks.

“Anti-steering” contracts. Insurers may entice people to go to lower-cost or higher-quality hospitals by making out-of-pocket costs lower for those facilities, but Hartford allegedly mandated insurers not to make those kinds of “steering” provisions (or to make them weaker).

Comment by: Don McCanne

There is general agreement that we are in drastic need of health care reform that will benefit patients – all patients. So what “reform” activities are taking place? Those that will benefit one portion or another of the medical-industrial complex and their investors – overall to the detriment of the patients.

What is missing? Social solidarity on the community level… Give this some thought, and it won’t seem so cryptic.

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