OP-ED: Public Health Professionals Weigh in on Hospital Merger

Rhode Island asks: Are there enough doctors in our house?


They started dating 24 years ago, broke off engagements four times, dramatically grew their families (out of wedlock), and now they are appealing to Rabbi/Father Neronha for his blessing in marriage. You couldn’t even sell this story in Hollywood, yet it’s now hoping to open soon on a big stage in Rhode Island.

The proposed merger of Lifespan (Rhode Island, Miriam, Hasbro Children’s, Bradley, and Newport hospitals) with Care New England (Women & Infants, Butler, and Kent hospitals) would create a healthcare system that would generate almost 80 percent of the state’s total patient revenue.

The positive spin is that this merger, which will include an integrated academic health system with Brown, will improve health care in Rhode Island through expanded access to primary care and specialists and will expand biomedical research and create new job opportunities. It will keep Massachusetts and Connecticut hospital systems at bay and stop the flow of personnel, patients, and, most importantly, healthcare dollars from exiting our state.

Opponents point out the obvious. The new entity will be a monopoly. Analysis of hospital mergers across the country finds that established monopolies increase healthcare costs without benefits to patients and workers, resulting in significant job loss. Health insurance premiums will go up. And need we even mention those golden parachutes?

So will this new merger really help us? Will this system address the dangerous lack of primary care doctors in our state? Will it reduce frustrating emergency room waiting times? And while there will be obvious cost savings to the hospitals, how do we insure the promised improved health outcomes for the community and any measurable cost savings to the taxpayers?

After speaking to a broad cross section of public health professionals, these seemed to be four dominant themes in their responses to the merger proposal.

A one payer system

This has been advocated by Dr. Jim Cowan, vice president of PHNP (Physicians for a National Health Program). “There are few things the government does well,” he argues, “but healthcare is one of them.” He suggests perhaps we consider Medicare for everyone? Probably not practical….but why not? 

Let the for-profit hospitals in and let them try

Many in the hospital business quickly round up figures to dampen this idea. The consensus: “The for-profits tend to have worse outcomes and even higher costs than non-profit institutions,” says Cowan – not surprising since their health decisions are often made by non-medical number crunchers.

Keep the system pretty much as is and let the insurance industry continue to run things

Some suggest that one of the major reasons health costs are so high and outcomes so resistant to improvement is that before you even try to improve healthcare outcomes medically, the administrative and paper-pushing costs total about 30 percent. Would the merger help? Patrick Tigue, the state’s health insurance commissioner, while not taking a position for or against the merger, questioned whether any real cost savings would take place. “If the consequence of a successful merger merely shifts competitive bargaining dynamics within the market, increasing prices without concomitant quality, then consumers should question the value of what they are deriving from the merger.”

Here are some numbers for you. Since 2000, the cost of general goods and services has risen 52 percent. Over the same period, the S&P is up 62 percent; the Dow is up 76 percent. The cost of healthcare itself is up 267 percent. And the stock price of the nation’s largest insurer, United Health Care, is up a whopping 770 percent. In other words, the cost of healthcare has gone up four times faster than other prices, while the country’s largest insurer has increased 14 times.

If large enough and with sufficient resources and oversight, let communities do it themselves

Certainly no one is in a better position to comment on the proposed merger than the former head of the Department of Health, Michael Fine, MD. Always frank and outspoken, Dr. Fine offered a variety of reasons why he supports the merger, though not without some important caveats: “With its million-plus people, a well-built physical infrastructure already in place and an academic powerhouse like Brown in our backyard, Rhode Island is a perfect size to control its own destiny.” He doubts that the FTC would approve the new entity unless the state agrees to provide rigorous regulatory oversight, agrees to play nice with the remaining hospitals, and offers a credible commitment to address the unmet needs of our underserved residents.

His own opinion is that the state would be better served, he says, “if we thought out what services we need to deliver the best care for our residents and then figured out how best to pay for them. We do the opposite: determine how much we are going to pay for a service and then let the market decide who, if anyone, gets it. And if we get improved public health out of it, that’s nice but more of a lucky accident. The twin focus of a merged entity should be the best public health delivered for 20 percent less than healthcare in Boston.”

Brown’s involvement is a game changer, he feels, in terms of attracting funding, researchers, and academic faculty into the state, and their recent successful development of a world class public health school proves his point. He wistfully imagines the incredible health research opportunities that might develop here if at some point all patients could be hooked up digitally and communicated to with a flick of a switch. “We would be a research Shangri-La,” he laughs. Collaborating with our other colleges and universities to help meet growing nursing, health tech, and other needs would help feed the system as well.

Dr. Fine has even bigger dreams of what the merged operation might mean for Rhode Island. “The problem now is we’re sandwiched between two medical powerhouses in New Haven and Boston. And while it would be difficult to match their resources and funding one for one, if we play this right, we can compete. Our size allows us to create an effective and efficient health system less expensively than our neighboring states. By delivering high-quality health care at a 20 percent lower cost without losing the academic cache, unique research capabilities, and quality-of-life perks of Rhode Island would make us quite competitive.”

Some final thoughts

As we go to press, the serious conversations have begun and behind-the-scenes negotiations in terms of details are occurring. The bottom line is that while many people support the concept of the merger in principle, the “devil will be in the details.” From our perspective, for the state to have so much of its healthcare controlled by one entity, there MUST be a very strong regulatory body, unlike PUC, which is often accused of being more of a “rubber stamp” for the utilities it is supposed to regulate. This new regulatory body must have wide and diverse representation so that the health of all of our citizens, from the wealthy to the homeless, is not jeopardized over economic interests.

Plus one final thought from Dr. Fine: “How about Brown committing to ensure 50 percent of their medical and public health students come from our local communities so the merger doesn’t become another example of the elites profiting from the backs of working Rhode Islanders?”


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