How a Hospital Merger Crushed Patient Prices

When two hospital chains in the same city merge, they promise efficiency and better care. But a landmark 2024 study by economists at the University of Chicago and Stanford found that hospital mergers in concentrated markets raised patient prices by an average of 11 percent. This episode drills into the 2027 case of the Ascension–Providence St. Joseph merger in Seattle, which consolidated 80 percent of the region's private-room capacity. Lucas and Luna walk through the specific contract clauses that allowed the merged entity to renegotiate rates with insurers upward, the FTC's failed challenge, and what operators should watch for when buying or selling healthcare assets. A concrete look at how market power gets priced into a deal, and why the earnout structure in this particular merger actually rewarded the price increase. #HospitalMerger #HealthcareM&A #AscensionProvidence #FTC #MarketConcentration #Antitrust #PricingPower #EarnoutStructure #SeattleHealthcare #MergerStudy #UniversityOfChicago #StanfordEconomics #PrivateEquity #BuyerPower #IndemnityEscrow #Business #FexingoBusiness #BusinessPodcast Keep every episode free: buymeacoffee.com/fexingo