Improved health care value cannot be achieved by hospital mergers and acquisitions alone

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A new study finds little evidence that hospital mergers and acquisitions reduce costs or improve quality of care. More strategic quality improvement efforts are needed for patients to benefit from health care integration. CHICAGO (December 30, 2024) — Mergers and acquisitions of U.S. hospitals and health systems rarely improve the quality of care delivered or result in lower health care costs and prices, according to a study published in the Journal of the American College of Surgeons (JACS).

The study, a systematic review of hundreds of published studies, comes amid accelerating health care integration, sometimes called consolidation. Nearly 70 percent of U.S. hospitals are now affiliated with a health system.

“Proponents of health care integration have claimed it controls costs and enhances care quality,” said lead study author Bhagwan Satiani, MD, MBA, FACS, professor of surgery emeritus at The Ohio State University Wexner Medical Center, Columbus, Ohio. “But we found that evidence is lacking that integration alone is an effective strategy for improving the value of health care delivery.”

The study results send a clear message to health care leaders, Dr. Satiani said.

“These findings provide an opportunity to better define value with a focus on benefiting patients while balancing the financial stability of the health care industry,” he said. “Quality improvement in health care cannot be achieved by mergers and acquisitions alone.”

Effects of Health Care Integration

The authors’ systematic review included studies published from 2000-2024. Of these, 37 met inclusion criteria. Among the 26 studies that measured quality of care, nearly 77 percent (20 studies) showed reduced quality or no change due to integration, the investigators reported. Only 23 percent (six studies) showed improved quality, primarily due to better care management processes rather than outcomes. Just one study found fewer patient deaths after integration.

Hospital charges increased with integration 93 percent of the time, according to 13 of 14 studies measuring price changes. Of 16 studies assessing health care spending, 81 percent (13 studies) showed higher costs or no change.

The researchers also reported the net impact of integration on quality, price, and spending:

Only eight of 37 studies (22 percent) showed that health care integration had a positive (improved) net impact. More than half (54 percent, 20 studies) showed a negative (worse) net impact. In noting limitations of their review, Dr. Satiani said none of the reviewed studies used standard measures of quality, price, or spending. Also, most studies did not explore reasons for a lack of change in health care value after integration.

How this Study Differs from Previous Research

Although other researchers have reached similar conclusions, Dr. Satiani said their study differed in two ways. First, most studies of health care integration appear in health policy and economics publications and do not reach many surgeons, he noted. Yet, surgical services affect health organizations’ bottom line, accounting for about one third of U.S. health care expenditures.

“Surgical outcomes also have a direct impact on overall health care quality,” he said.

Second, Dr. Satiani said few of the published studies were systematic reviews, which are intended to reduce bias.

In this study, after screening 1,297 U.S. articles published from 1990 to 2024, the investigators systematically reviewed 384 of them that discussed either horizontal or vertical health care integration. They defined horizontal integration as two or more hospitals merging and vertical integration as hospitals acquiring independent physician practices.

To be included in the review, articles must have reported at least one of three measures of value: quality, price, and spending. Quality referred both to patient outcomes, such as the number of 30-day readmissions or deaths, and to care management processes. Such processes included staffing levels and use of nurse care managers. Price denoted the amount the organization charges the consumer per hospitalization, and spending was the organization’s costs per patient.

Focus on Quality Improvement

Dr. Satiani said health care leaders should delineate organizational resources and infrastructure to quality improvement efforts and standardize quality metrics. As a model for quality improvement, he suggested the American College of Surgeons Quality Verification Program as a model improving surgical quality.

Study coauthors are David Way, MEd; David Hoyt, MD, FACS; and E. Christopher Ellison, MD, FACS.

The study authors have no relevant disclosures.

This study is published as an article in press on the JACS website.

Citation: Satiani B, Way DP, Hoyt DE, Ellison EC. A Systematic Review of Integration Strategies Across the U.S. Healthcare System Shows No Consistent Improvement in Price, Cost Reduction, or Quality of Care. Journal of the American College of Surgeons. DOI: 10.1097/XCS.0000000000001229

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About the American College of Surgeons

The American College of Surgeons is a scientific and educational organization of surgeons that was founded in 1913 to raise the standards of surgical practice and improve the quality of care for all surgical patients. The College is dedicated to the ethical and competent practice of surgery. Its achievements have significantly influenced the course of scientific surgery in America and have established it as an important advocate for all surgical patients. The College has approximately 90,000 members and is the largest organization of surgeons in the world. "FACS" designates that a surgeon is a Fellow of the American College of Surgeons.

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