The numbers are striking.
After years of consolidation, most acute care hospitals in Connecticut are owned by a handful of large health systems. And the bill for participating in those health systems continues to grow.
Connecticut hospitals now pay health system fees totaling more than $1.6 billion per year, a figure that doubled in less than decade.
Health systems say those fees are tied to shared services that each hospital receives, such as accounting and legal work.
But an investigation by The Accountability Project found state officials have little insight into how these fees are derived, and why they’re growing each year.
Investigative reporter Maysoon Khan dug through years of regulatory filings to compile the numbers. She found that Connecticut has no laws governing these fees, nor are there caps on how much health systems can charge member hospitals.
Health reporter Sujata Srinivasan explored the experience of patients, profiling a mother who didn’t know where her child would be born because the health system that controls her local hospital announced plans to shutter its labor and delivery services, even as it charged the hospital millions more in annual fees.
In written statements, representatives of the health systems told us their hospitals receive additional benefits for joining a larger network, such as access to advanced technology, and fiscal stability during a cash crunch.
But research suggests consolidation can also drive up health care spending without producing significant benefits for patients.
A study released last year by the Connecticut Office of Health Strategy (OHS) found that in most parts of the state, hospitals that increased their market power by joining health systems hiked their prices faster than other facilities, and saw more growth in high-profit services, such as cardiac care, and slower growth in less profitable services such as childbirth and behavioral health.
Getting more transparency could require a change in state law. Olga Armah, manager of research and planning at OHS, said her office doesn’t assess whether health system fees are reasonable because it’s not within their purview.
State Sen. Saud Anwar, who chairs a legislative public health committee, said it’s impossible to understand these fees without more insight about what they include.
“It could be very justifiable, or it could not be justifiable,” Anwar said. “And I cannot answer that, and neither can anyone else, until we have that information.”
