A new report issued today claims that the expansion of Connecticut’s largest hospital system threatens to bring large price spikes to consumers along the state’s shoreline. The study by a union-led coalition finds fault with Yale-New Haven Health System’s dominant impact on inpatient care in the southern half of the state and New London.
The data reveal that communities impacted by Yale-New Haven Health System’s proposed acquisition of Lawrence + Memorial Health and possible absorption of struggling Milford Hospital could face large price increases as Yale-New Haven’s market power grows.
The report, “Hospital Market Concentration in Connecticut: The Impact of Yale-New Haven Health System’s Expansion” documents how the proposed takeovers will leave the Yale-New Haven System with nearly 60 percent of the inpatient hospital market in the southern half of Connecticut and 83 percent of the market around New London, levels at which federal standards warn against unnaturally high prices.
The potential purchase of Lawrence + Memorial Health, owner of Lawrence + Memorial Hospital in New London and Westerly Hospital in Rhode Island, is currently pending for approval before state regulators.
The coalition report says studies show that price increases of more than 20 percent follow hospital mergers in highly concentrated markets. The report finds that markets in Connecticut are already highly concentrated. It studies concentration in five regional markets. If Yale-New Haven acquires Lawrence and Memorial, and fully absorbs Milford, the growth in concentration in those areas would be between 50 percent and 900 percent higher than the level at which federal regulators presume that mergers will create enough market power to artificially raise prices.
Sponsors of the report include: AFT Connecticut; Connecticut Citizen Action Group; Connecticut Health Policy Project; Council 4 AFSCME; District 1199, New England Health Care Employees Union; United Action Connecticut; and, UNITE-HERE! Connecticut.
