Managed Healthcare Executive® State of Industry Survey: More Consolidation of Providers in 2022

MHE Publication, MHE January 2022, Volume 32, Issue 1

Forty percent of the respondents to our annual State of the Industry survey expect vertical integration of providers to increase this year.

Scratch beneath the surface of almost any recent trend in healthcare and you’ll find that it is not as new as it might first appear.

But there is really nothing new about consolidation in healthcare. Hospitals have been combining into larger, market-dominating systems for decades. According to a 2020 Medpac report, 90% of hospital markets met Federal Trade Commission definitions for “highly concentrated” in 2017 and there are no indications of the trend reversing since then.

The same is true of the payer side of the street. The Medpac report says 21 of 51 regions (the states plus District of Columbia) had group insurance that were super-concentrated.

Even if consolidation isn’t news, it ranked among the top concerns of the 100 respondents to our annual State of the Industry survey. In fact, it was the top issue when we asked respondents to rank issues in order of importance.

Related: Managed Healthcare Executive® State of the Industry Survey, A Look Ahead , First Installment

We asked also asked which consolidation trend is most likely to accelerate in 2022. Vertical integration of providers (40%) and horizontal integration of providers (24%) garnered many more responses than vertical integration of payers (13%) and horizontal integration of payers (12%).

The Biden administration has said it is going to increase antitrust scrutiny of consolidation in all aspects of the economy, including healthcare. A solid majority (59%) of the respondents to our survey said they favored the administration using antitrust law to slow down or block consolidation among providers.