Jersey Shore University Medical Center is the flagship hospital of Meridian Health. Internet photo
Hackensack University Medical Center. Internet photo. There is no sign of a university medical school near either of these hospitals.
By Paul Goldfinger, MD. Editor @Blogfinger.net
According to a report in today’s Asbury Park Press, this merger of two large healthcare systems is being done because of “financial pressures” on both systems due to the Affordable Care Act, “better known as Obamacare.” It will result in the largest such system in New Jersey.
This is just part of a frenzied re-shuffling of the healthcare deck which we are experiencing all around us. Hospital mergers like this have been occurring over the last ten years, but they have been accelerating due to pressures resulting from the ACA.
For example, on the physician side, we have seen most of the oncologists in New Jersey joining together and then merging with similar groups in nearby states. All of this is part of a power struggle for health providers to stay afloat and make money. As far as hospitals are concerned, they are trying to become huge corporate players by swallowing up their neighbor hospitals and maneuvering private practice doctors into becoming employees. In addition they are becoming like Amazon.com, trying to be the providers for everybody for everything, including all sorts of outpatient services like imaging centers, physical therapy facilities, surgical centers, and even nursing homes and insurance plans.
The result of such consolidations might raise the cost of healthcare, even though Meridian-Hackensack claims that they will lower the costs, as promised by the ACA. The insurance industry is less sanguine about this point. Wardell Sanders, who is president of an insurance trade group said, “Providers and hospital consolidations are often sold as measures to increase ‘efficiency’, but ironically they often result in higher prices for employers and individuals as efficiencies can be overshadowed by higher charges that larger health care systems often leverage in negotiations.”*
In plain English, your insurance premiums will probably go up, sooner or later. (Note: For the next few years, the Federal Government is subsidizing insurance companies to keep them afloat, but when those subsidies end in 2017, the cost of insurance will go up more, even as they are already going up for some now.)
You will be told that these consolidations are about quality care, but I seriously doubt that, having experienced a hospital merger in Morris County first hand in the late 1990’s. In this Meridian-Hackensack instance there is minimal talk about quality, with some vague references to prevention as a way to reduce costs. I am very skeptical about that point, and on Blogfinger, we have been focusing on quality concerns since the ACA appeared on the scene.
The first thing that happens when hospitals merge is that employees are fired in large numbers to save money, especially at the hospitals that are deemed expendible after a merger. This is accomplished by consolidating services, such as neurosurgery (ie “neurosciences services”) which might, for example, wind up in Hackensack. Next, once they have bought up rival hospitals, they may downsize them and then close them, deeming them to be useless (a self-fulfilling prophecy) and thus accessing the patient base of those hospitals.
Note that the discussions about this merger, as reported, do not include the words “regional healthcare planning, patients’ needs, or patients’ freedom of choice.”
Presumably these two players will divide up the categories of care and then establish “centers of excellence” in one area or the other. This happened when Mt. Sinai in New York merged with NYU, but the whole thing fell apart over turf wars.
There is a giant snowball rolling down hill in healthcare, and patients should keep their eye on that ball, focusing on cost and quality. The ACA horror and success stories will be evident as time goes by; we don’t know how the scales will tip. Meanwhile, we are in the beginning of first inning of a long game ahead.
* Article from NJ Spotlight: Merger report on NJSpotlight.com
AL JOLSON with a song that might apply to how the patients view this situation.
Dear Paul
I know you remember Managed Care when it was in vogue and we were guaranteed it would rein in costs for everyone. Back then they used buzz words like gatekeeper to describe the physician who would control all aspects of your medical care. Now they are referred to as primary care physicians to direct your healthcare.
Costs did not go down; a few well placed inside individuals made huge sums of money promising healthcare for less. Instead we got less healthcare and little or no say so in our care—like we were children. And costs went up.
Welcome to déjà vu all over again.
Remember, when they say they are from the government and they are here to help, be afraid, very afraid.
Maybe it’s time to get with the program and give the ACA a chance to work. (Inflation in health costs are abating, and lots of people now have insurance too.)
As for the merger, consolidation has been taking place in the industry for decades. A cottage industry that doctors could control to their advantage is actually turning into a business. All for the better in my opinion. Hospitals integrated delivery networks (IDN) have budgets in the billions of dollars, and this type of scale is needed to provide the expensive high-tech services Americans are accustomed to. And each of these institutions have some complementary strengths that were cited in the Press article. I’m sure it was done for good reason.
If Meridian comes up to the Standard of Hackensack Hospital ..I for one will be thrilled… I have been in both over the years and can tell you my experience at Hackensack was far superior to my experience at Meridian…
GetItDone: I guess you think you can read my mind, but you are wrong. If the Meridian-Hackensack merger would magically morph into the Kaiser-Permanente system, I would be delighted, but it’s not going to happen.
As for “full disclosure,” what do you want disclosed? If you mean that I should disclose the fact that I am a physician, perhaps you missed my byline at the top of the article or my bio. information in the “About” section on the top of our home page. I do think that if you are going to demand “full disclosure” by me, then perhaps you would consider telling us your name. —Paul
—Paul
If this merger moves in the direction such as the Kaiser system in California then, as a CA resident, New Jersey residents will be much better off. Based on your comments I would not at all be suprised to hear that you would most likely disagree with my expectation….Since you are a doctor I think full disclosure by you should be made when you comment on these matters.