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A new study has found that the acquisition of rural hospitals results in mixed outcomes for mothers and newborns.
Five years after an acquisition, rural hospitals were 30% less likely to offer obstetric services, according to the National Bureau of Economic Research paper, “Expecting Harm? The Impact of Rural Hospital Acquisitions on Maternal Healthcare.”
Researchers examined more than 450 mergers between 2006 and 2019 that involved rural hospitals.
WHY THIS MATTERS
M&A resulted in a decrease in the number of obstetric care resources in the county in which the acquired hospital was located. This corresponded to large declines in the numbers of births at the acquired hospitals.
Patients had less local access to care, and there were more negative effects on maternal health. Negative effects included higher rates of smoking among pregnant women and small increases in maternal morbidity, the study said.
However, in some cases, the adverse effects were counterbalanced by patients going to higher-quality facilities elsewhere or by improved quality of the local hospital following the merger.
In acquired hospitals that did not close their obstetric departments, the quality of care tended to rise, the study said.
Researchers and article authors David Dranove, professor of health industry management at Northwestern University's Kellogg School of Management, who led the study; Marty Gaynor emeritus professor of economics and public policy at Carnegie Mellon’s Heinz College; and Eilidh Geddes, assistant professor of economics at the University of Georgia’s Terry College of Business, suggest antitrust enforcers who evaluate mergers pay close attention to the effects on patient outcomes.
“Based on our findings, we suggest that antitrust enforcers who evaluate mergers pay close attention to the effects on patient outcomes,” said Geddes. “They should not always assume that acquisition-induced closures consistently result in poorer outcomes, especially when acquisitions do not involve closing obstetric units.”
Although researchers found no evidence of changes in newborn outcomes overall, they did find improvements in newborn health for Medicaid patients.
THE LARGER TREND
The researchers examined hospital mergers based on information from the American Hospital Association’s Annual Survey of Hospitals and a merger database from a data analysis firm. They measured birth outcomes using county-level data. They identified more than 450 mergers between 2006 and 2019 that involved rural hospitals.
ON THE RECORD
“The hospital industry has undergone tremendous transformation over the past few decades, with nearly 1,600 mergers between 1998 and 2021,” said Gaynor. “Wholesale changes to the healthcare system, as embodied by the trend in consolidation, can simultaneously affect costs, quality and access to care.”
Email the writer: SMorse@himss.org