- A recent National Bureau of Economic Research working paper reveals that increased health care costs following hospital mergers lead to higher insurance premiums for employers, prompting them to lay off employees rather than reduce wages. Researchers from multiple institutions, including the University of Chicago and Harvard, found that a 1 percent rise in health care prices resulted in a 0.4 percent decrease in non-health care employment. For mergers increasing prices by 5 percent, significant economic impacts included local wage losses, job reductions, reduced federal tax revenues, and even potential increases in unemployment insurance payments. The study, analyzing data from 304 hospital mergers between 2010 and 2015, underscores the broader social and economic consequences of health care consolidation, advocating for measures to address rising health care costs in the U.S. (Article here)
July 16, 2024
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