Washington, D.C. — In advance of a hearing in the Pennsylvania House Health Committee to consider HB2344, a bill that would empower the state attorney general to investigate and rein in consolidation in hospitals and nursing homes, the American Economic Liberties Project released the following statement in support.

“Rampant hospital consolidation has harmed patients, workers, and communities across Pennsylvania for far too long,” said Pat Garofalo, Director of State and Local Policy at the American Economic Liberties Project. “HB2344, The Health Care Facilities Act, provides the state attorney general with the necessary power to block hospital mergers and protect Pennsylvanians from their downstream effects, which include price increases, deteriorating health outcomes, and lower wages for hospital workers. This bill rightly recognizes the threat consolidated hospital systems, such as the University of Pittsburgh Medical Center, pose and rightly puts the needs of communities ahead of the profits of corporate behemoths. We’re thankful for Rep. Borowski and all the co-sponsors for introducing this critical measure and urge the House Health Committee and the full legislature to swiftly approve it.”

Last summer, Economic Liberties released a policy brief detailing how hospital mergers hurt patients and staff, and offering a policy roadmap for federal and state to push back against the rapid consolidation sweeping the industry. Mergers between hospitals often result directly in higher costs for patients, with mergers leading to price hikes of more than 6% and in some cases reaching 65%, according to research. Yet, reduced competition doesn’t just allow consolidated hospital systems to charge higher prices; it also reduces incentives for hospitals to improve quality of care and access. Nurses, pharmacy workers, and other hospital staff are also harmed, with wage growth slowing 1—1.7% compared to more competitive markets. And unfortunately, hospital consolidation is part of a worrying trend. In 1970, just 10% of community hospitals were part of larger health systems; that share grew to 67% in 2019.

University of Pittsburgh Medical Center (UPMC) is a particularly egregious example of hospital consolidation. The 40-hospital chain and insurance network in Pennsylvania owns over 60% of the hospital beds in local areas and employs more than 65% of hospital workers. As previous work from Economic Liberties, Congresswoman Summer Lee and Rep. Sara Innamorato shows, UPMC’s mergers have led it to acquire monopoly power in Western Pennsylvania. This concentration across the healthcare market gives UPMC considerable leverage over workers, which it wields to keep wages low, unilaterally change wage levels with little warning, keep conditions unsatisfactory, and prevent union organizing, all of which harms not just those employees, but patients, and broader communities.

Read “The Harms of Hospital Mergers and How to Stop Them” to learn more.

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