Big Healthcare Systems Are Driving Up Costs

Ascension’s Columbia St. Mary’s Hospital. Photo by Jeramey Jannene.

Here in Milwaukee, and across the state and nation, our incredibly expensive healthcare system faces yet another troubling trend: large hospitals are buying small physician practices and charging patients more to access the exact same care there. As a family physician concerned about the skyrocketing cost of health care keeping my patients from accessing the care they need, I am calling on Congress to act.

Health care mergers are surging; over the last few years, it seems we’ve been unable to escape from the news of one hospital system buying up another. But it’s not just hospitals – small physician practices are being purchased, too. In fact, over half of physicians are now employed by hospitals and health systems. Patient care is being shifted from lower-cost options in regular physician offices to “outpatient departments” of hospitals.

Unfortunately, these mergers haven’t demonstrably increased quality of care — just the cost of it. Doctors know it’s just a new way for big hospitals to game the system and make more money. If I order a screening or a biopsy for a patient, it will cost them significantly more if they have to go to an “outpatient department” instead of an independent clinic. Either way, the services will be the same. Just because a hospital now owns your local doctor’s office, they can jack up the prices.

The numbers are startling. On average, when a physician’s office is acquired by a hospital system, the prices increase by 14 percent. This year, Medicare pays a whopping 194% more for an echocardiogram in a hospital outpatient department than in a regular freestanding physician office. When hospitals acquire physician offices, they can bill privately insured patients an additional facility fee. When they do this, the average price for an ultrasound increases from $164 to $339. Billions of dollars are coming out of the pockets of patients like mine, and going into those of big hospital executives. As these health care costs continue to increase, premiums for all of us increase.

Doctors know too well how skyrocketing health care prices negatively impact our patients. When patients get a bill for services that is higher than expected, they become wary of future visits. They decide to put their care off to put food on the table. Their health conditions, which are often treatable and manageable if intervention begins early enough, become more difficult and expensive to treat.

Thankfully, Congress can act to help solve this problem, and ensure that patients receive the same services for the same prices. We can all agree that patients shouldn’t be charged more for the same care just because of where they receive it — this is truly a bipartisan issue, one we can all rally around.

It’s time for big hospitals to stop gaming the system at the expense of patients like mine. Physicians are calling on Congress to act and save our patients billions of dollars in unnecessary health care costs.

Dr. Madelaine Tully is a family physician in Milwaukee County and member of the Committee to Protect Health Care.