Study reveals that hospital acquisitions that avoid antitrust review result in considerably higher costs
A recent study found that hospitals that merge under state limits that shield them from federal oversight had a tendency to eventually shed such controls and drastically boost rates after they lose their protection from the federal government.
According to a study that will be published in the Journal of Law and Economics, hospitals increased their expenses by 39% to 51% when their state-regulated certificates of public advantage, or COPAs, were repealed or expired.
The study was conducted on hospitals in the United States. COPAs make it possible for anticompetitive mergers to move forward under state regulation, allowing them to sidestep the federal antitrust litigation that they would have been required to confront otherwise.