Scholar argues that rural hospital mergers put mothers at risk and suggests policy reforms.
The United States spends more money on health care than any other nation, but the maternal mortality rate in the United States is the highest among wealthy nations.
According to Theodosia Stavroulaki, policymakers have overlooked hospital mergers as a contributing factor. In a recent article, Stavroulaki, a law professor at Saint Louis University, argues that hospital mergers, particularly in rural areas, result in worse health outcomes for mothers. She advocates that antitrust enforcement agencies scrutinize these mergers to protect mothers.
Rural hospitals face unique financial difficulties, Stavroulaki explains. Because they serve less densely populated areas than urban hospitals, rural hospitals see fewer patients overall, making it harder to cover expenses. Moreover, patients with private insurance—more lucrative for hospitals than patients with Medicaid—tend to travel further to reach urban hospitals, depriving rural hospitals of the most valuable patients.
In response to financial pressure, many rural hospitals resort to merging with competitors, hoping that a merger will provide both immediate resources and long-term stability.
Stavroulaki explains, however, that after a merger, hospitals tend to cut certain services—particularly obstetric care. One study found that among a sample of hospitals that had merged, the number offering obstetric care decreased from roughly 75 percent to 61 percent, post-merger. Hospitals were especially likely to cut obstetric care within the first two years after merging. Today, more than half of rural counties have no hospital that provides obstetric care, Stavroulaki observes.
She contends that these mergers endanger mothers. When hospitals cut obstetric care, pregnant women must travel further. More than 50 percent of women in rural areas must travel over 30 minutes for care. Some must travel for hours. This increase in travel time alone is dangerous—many obstetric emergencies demand a response within minutes. But for low-income women, obstacles to traveling, such as taking time off from work or affording child care, might force them to forgo medical care entirely. As a result, women in rural areas face a nine percent greater chance of maternal mortality.
Stavroulaki also identifies a second victim of these mergers: hospital staff. She explains that after a merger, the resulting single hospital sometimes gains a monopoly over its region, enabling it to underpay workers. If only one hospital remains in a small town after a merger, then nurses in that town with specialized or nontransferable skills have little leverage to bargain for better pay. Rural hospitals, because they tend to be geographically isolated, exhibit this effect even more.
This effect hurts nurses themselves: With less income to afford quality housing and nutrition, they experience worse health outcomes, Stavroulaki argues. But moreover, when nurses experience more stress and fatigue due to a merger—or outright quit, exacerbating staff shortages—then these mergers further hurt the quality of the medical care that patients, including mothers, receive.
Regulators must do more to reduce these harms, Stavroulaki insists, and she identifies antitrust laws as the tool to do so.
Under the Hart-Scott-Rodino Act, mergers of a certain size must first be presented to the Federal Trade Commission (FTC) and the U.S. Department of Justice for preapproval before the merger can proceed. Stavroulaki proposes that these agencies focus on challenging hospital mergers that would decrease access to obstetric care. She points to past cases where the FTC challenged a proposed merger because the merging hospitals would have restricted specific medical services, such as oncology or mammography, to just one of the merging hospitals. The Commission reasoned that even if the mergers would benefit some consumers, they would harm others. Stavroulaki suggests extending the same scrutiny to mergers that threaten obstetric care.
Stavroulaki likewise argues that the FTC and the Justice Department should scrutinize hospital mergers that threaten to depress workers’ wages. She envisions that, when reviewing a merger proposal, the agencies could consider factors such as the distance to the next-nearest hospital or the availability of public transportation to determine whether a hospital could underpay workers post-merger. Although the FTC and Justice Department have historically focused on harms to patients, not workers, when reviewing hospital mergers, the agencies have the same legal authority to challenge a merger for either reason.
Stavroulaki also argues that regulators, when exercising their authority to place conditions on merger approvals, should stipulate that merging hospitals cannot cut obstetric care. She points to one instance where, to receive approval, the merging hospitals committed to maintaining certain services, including pediatric trauma and emergency care, for at least 10 years.
Stavroulaki considers the counterargument that if agencies prevent financially struggling hospitals from merging, then some hospitals may simply go out of business. She argues, however, that this fear is not justified based on the data. One study found that for many rural hospitals, a merger does not help their financial problems. Another study, although it found that some rural hospitals did benefit from merging, found that those hospitals’ improved profits only resulted from cutting the least profitable health care services—including obstetric care.
For decades, U.S. antitrust law has maintained the principle that the benefits of a merger to one group of consumers cannot offset the harms that it causes to another group. For Stavroulaki, to permit hospital mergers at the expense of mothers would be to deny them the equal benefits of the antitrust laws.
