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ACM sees more anti-competitive risks of hospital mergers

05-12-2017

 

The Netherlands Authority for Consumers and Markets (ACM) intensifies its attention for anticompetitive risks of hospital mergers. A study into the effects of hospital mergers on prices and volumes has shown that prices increase, relatively speaking. It had previously been revealed already that health care quality does not demonstrably improve after mergers. These are critical competition parameters against which ACM tests planned mergers. ACM’s decision to intensify its attention for anticompetitive risks is also triggered by the experiences other stakeholders have had and by the risks they have identified next to the results of said studies into the effects on prices, volumes and quality.

Chris Fonteijn, Chairman of the Board of ACM, explains: “As we are learning more and more about the implications of hospital mergers, we are taking into consideration the risks for competition more and more critically. We do so under the competition-law merger assessment that is currently in place.”

Merger assessments

It should be noted that public support for hospital mergers and ever expanding hospitals appears to be waning. ACM tests mergers against the Dutch Competition Act, finding out what their effects are on competition. Opinions held by members of society such as attention for the ‘human dimension’ or manageability have no place in this assessment. If the public and lawmakers want hospital merger assessments to take into consideration these kinds of public interests, ACM then sees opportunities for incorporating them in the health-care-specific merger assessment (in Dutch: zorgspecifieke zorgtoets).

What does ACM’s intensified attention entail?

Intensified attention for anticompetitive risks of hospital mergers means that we may establish anticompetitive problems more often. Furthermore, health insurers indicate they experience buying problems more often as a result of mergers. ACM may thus block hospital mergers sooner. However, in such situations, the merger parties still have the opportunity to demonstrate their merger’s benefits (quality benefits or otherwise), but the bar is set high to do so.

Hospital mergers: indications of higher prices

ACM today publishes the results of its study into the effects of hospital mergers on prices and volumes of treatments. The main conclusion is that prices at merger hospitals increase, relatively speaking, compared with prices at non-merged hospitals. Volumes at merger hospitals show trends comparable to those at non-merged hospitals. ACM had previously a study carried out into the effect of hospital mergers on quality. That study revealed that hospital mergers do not have a demonstrable positive effect on health care quality.