Nurses Call on Federal Trade Commission and Department of Justice to Strengthen Guidelines to Limit Negative Effects of Mergers, Acquisitions on Patients and Healthcare Workers

National Nurses United (NNU) is calling on the Federal Trade Commission (FTC) and Department of Justice (DOJ) to substantially strengthen antitrust scrutiny and anticompetitive guidelines on healthcare industry mergers and acquisitions in response to widespread adverse consequences for patients, nurses, other healthcare workers, and local communities.

At the direction of President Biden, the FTC and the DOJ invited testimony and comments for revising and updating their horizontal and vertical merger guidelines, the frameworks for analyzing business mergers under antitrust laws. Following public testimony last week, including from an NNU RN, FTC Chair Lina Kahn, said, "As we've heard from several of you, sometimes that cost cutting can come at the expense of quality of care." The public comment period ends today.

In comments submitted this week, NNU's Lead Regulatory Policy Specialist Carmen Comsti wrote that "anticompetitive behavior in the health care sector through market consolidation is a threat to the health and safety of nurses and other health care workers and is making our patients sicker." The "monopoly power of employers," she said, "exacerbates problems with health care access and affordability" for the public, and, for nurses and other healthcare workers, "depresses wages and dilutes the power of workers to advocate for better working conditions and patient safety." (Full NNU comments available upon request)

The FTC and DOJ, Comsti wrote, should "presumptively consider any merger or acquisition in the health care sector, particularly hospital acquisitions, to be anticompetitive."

In her hearing testimony, Kelley Tyler, an NNU member and RN at Mission Healthcare in Asheville, N.C., cited the first-hand experience of how conditions at Mission deteriorated following the acquisition of her community hospital by corporate giant HCA Healthcare. "Services like rural cancer care and wheelchair and seating clinics have been cut completely. HCA has shuttered primary care clinics and driven out hundreds of doctors and nurses. Our more vulnerable populations have suffered, especially seniors, who are often forced to drive over an hour for needed care," said Tyler. HCA, she added, has even "taken its hatchet to charity care, geriatric services, security, and even hospital chaplains."

"We believe HCA uses its market domination over Western North Carolina to gut our healthcare system, then send the profits back to executives and Wall Street shareholders," said Tyler, urging the FTC and DOJ to "modify ... procedures around mergers and acquisitions to protect communities like Asheville from companies like HCA."

In her expansive comments, Comsti elaborated on NNU's concerns. They included:

• Traditional distinctions between vertical and horizontal mergers have largely evaporated due to abuse of market power by large health care systems. Corporate financial interests' integration into and control of different types of health care facilities can incentivize interference with the professional judgment of practitioners and reduce practitioner autonomy.
• The role of private equity ownership and its "strong tendency ... to focus on short-term profits, maximizing returns paid to investors, and minimizing liability by financing acquisitions through debt" has adversely affected patient outcomes and safety. The FTC and DOJ, Comsti wrote, should especially analyze the deleterious effects of private equity ownership in health care, which "is particularly damaging and even deadly." Health care facilities owned and/or operated by private equity exhibit characteristics including "lower staffing levels, higher prices for care, and higher medical debt for patients."
• Health care market concentration is strongly associated with huge increases in predatory pricing practices by insurance companies and other payers and hospital charges, all of which have contributes to such adverse consequences as a national scandal over medical debt and in forcing up to 40 percent of Americans skip needed care due to escalating costs. Today, two-thirds of hospitals belong to multi-facility systems, compared to just 37 percent in 1994. An NNU report released in 2020 found that hospitals, driven by large systems, hike their charges by as much as 18 times over their costs. https://act.nationalnursesunited.org/page/-/files/graphics/1120_CostChargeRatios_Report_FINAL_PP.pdf
• Conglomeration is increasingly seen when an acute-care hospital system acquires or merges with physician practices, home health agencies, telehealth service providers, outpatient clinics, nursing homes, skilled nursing facilities, or other post-acute care facilities -- and it frequently results in cuts in patient services as well as higher prices for care. One consequence has been the increased shift of needed care work to unpaid family caregivers or unlicensed aides, rather than RNs and other professional caregivers.
• For RNs and other health care workers, mergers and acquisitions "dilutes the bargaining power of workers over terms and conditions of employment" with negative effects on wages and working conditions like safe staffing levels. In addition to harming patient safety, "intentional understaffing, lack of health and safety precautions, and other poor working conditions have driven nurses away from bedside nursing," Comsti noted.

Among NNU's recommendations, it called on the FTC and DOJ to expand antitrust scrutiny and other guidelines in reviewing past practices of the buyers, such as higher charges to payers and patients, hospital closures and patient service cuts, adverse impacts on independent safety-net hospitals and public health care facilities, past anti-union behavior, and degradation of patient privacy and information sharing with technology firms. These measures and additional remedies in merger and acquisition guidelines can protect patients, workers, and communities.