Last week there was an article in the Indianapolis Star called Do your home work or pay the price. http://www.indystar.com/article/20100629/BUSINESS/6270392/1003/BUSINESS
It was a very interesting article because it address what has been going on in the health care industry locally and the rest of the country. What we are are seeing is hospital groups buying up smaller medical practices. Most people would not think this has a big impact on their health care but it does.
What is going on is a hospital group buys an outpatient treatment center. That out patient treatment center has negotiated their own network discounts with the local and national PPO plans. So if you go in for a procedure that price could be $1,000. With the negotiated network discount that procedure is discounted down to $356. All of the discounts can be different. What we have seen is most hospitals have higher costs for their procedures. So for the exact same procedure that is discount to $356 at the out patient center could cost $800 at the hospital.
So what is happening is hospitals groups are buying the smaller facilities and applying their negotiated discounts which are much higher. This is increasing the cost of care which add to higher premiums and higher out of pockets for the consumers.
There is a positive side to the larger health care groups buying up the smaller ones. These pertains to the rural communities and the local hospital. Most of those hospitals have a hard time operating in the black. So instead of those local centers shutting down a larger group can buy them and operate them. This is important because in that local community those resident do not have any other options.
I was happy to see this article printed by the Indianapolis Star because the general public need to know the cost of care.