Hospital Ownership the Focus of New Medicare Report
By Joey Berlin

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In an effort to analyze the impact of consolidation within the health care system, Medicare for the first time has released data on mergers and acquisitions for enrolled hospitals and nursing homes between 2016 and 2022.

The Centers for Medicare & Medicaid Services (CMS) said the report follows up on President Joe Biden’s Executive Order on Promoting Competition.

“This new data gives researchers, state and federal enforcement agencies, and the public new opportunities to examine how mergers, acquisitions, consolidations, and changes of ownership impact access to care, care quality, and prices as a way to enable greater transparency and insight into the hospital and nursing home industries,” CMS Administrator Chiquita Brooks-LaSure said in a statement.

An accompanying analysis of the data by the federal Office of the Assistant Secretary for Planning and Evaluation (ASPE) didn’t contain the exact ownership numbers for each individual state, but HHS told Texas Medicine Today that during the period studied, 26 of 549 hospitals in Texas changed hands, or 4.7%. The national average was 4.6%.

Most states had less than 4% of their hospitals change ownership, CMS said, but the numbers varied widely by state. Nursing home ownership changes have been much more common than hospital ownership, the data show.

Other notes from the ASPE national analysis included:

  • 85.5% of purchased hospitals had a single direct organizational owner, while 6.4% had at least two organizational owners but no individual owner with as much 5% interest.
  • About 15% of hospital transactions were mergers, which still counted as a “sale” for the purposes of the federal report.
  • The most commonly sold hospitals were “[l]ess profitable and medium to large” facilities.
  • Critical access hospitals “were almost never sold,” although more than 30 have closed in the past two decades.
CMS says it expects to release updated change-of-ownership numbers quarterly. Echoing Administrator Brooks-LaSure’s comments, the ASPE report said the data can “allow regulators to better track consolidation in health care provider markets and, in the long run, support pro-competitive policies that can help reduce health care costs. ... Health care consolidation has significant impacts on consumers, raising the importance of these issues.”

Last Updated On

May 09, 2022

Originally Published On

May 09, 2022

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