The healthcare landscape in Michigan is undergoing significant transformation as Ascension Health plans to divest four of its hospitals in the state. This move is part of a broader trend of healthcare system consolidations that may affect competition and costs for consumers.
As Ascension Health prepares to transfer its last hospitals branded under its name by this summer, it follows previous activities including a partnership with Henry Ford Health and a sale to MyMichigan Health. These strategic decisions are reshaping the state’s healthcare system dynamics.
Allan Baumgarten, a healthcare market analyst from Minneapolis, observes that Ascension’s exit coincides with notable acquisitions, such as Michigan Medicine’s purchase of Sparrow Health System and Spectrum Health’s merger with Beaumont Health. According to Baumgarten, while these mergers might bolster hospital profit margins, they pose challenges for health insurance consumers.
He points out that diminished competition among healthcare providers can hinder the ability of insurance plans to negotiate cost-effective care. “The level of competition between health systems is going down [in Michigan] and the ones that remain are larger and larger. Research shows that this usually results in higher prices. And there’s not much evidence of improvements in quality,” Baumgarten notes.
Three years ago, a major consolidation occurred when Spectrum Health and Beaumont merged to form Corewell Health. Likewise, Michigan Medicine expanded by acquiring Sparrow Health System. Both Corewell Health and Michigan Medicine assure that these mergers are poised to enhance patient access to quality care, with Corewell specifically highlighting potential cost reductions in health care services.
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