Don't take it from me. The number is a (conservative) federal estimate. Much of the extra cash goes to executives like Steven Corwin, who made $26 million in 2024 running a "nonprofit" hospital chain.
Hospital and insurance CEOs have near monopolistic pricing powers. Most illegals get free healthcare. Citizens foot the bill for all our healthcare needs.
The left hates monopolies unless they are unions, hospitals or government itself which is the biggest monopoly of all and has a monopoly on force. Coincidentally (/sarcasm) they want to control them all.
That's not entirely true. The old guard democrat big wigs like Schumer, Pelosi and the Clintons love monopolies, so long as they pay their tribute to the democrat party, as well as their personal foundations.
The true believer leftists, like this Chevallier character that just got herself elected to Congress, hate anything that charges people money, monopoly or not.
Thank you for staying on top of this important issue! The government should remove the non-profit status of hospitals, colleges/universities, and alleged religious organizations (think: Scientology). It is grossly unfair that my business pays taxes and they do not. I help a lot of people every day. Yet, I do not get any tax breaks. To exacerbate this discrepancy, I live in the incompetent dem-socialist state of California, where the state is essentially stealing my earnings. (Yes, I'm trying to get out.)
Taxing them won't change the nature of the tiger's stripes. It will cut into capital investment.
Maybe ask what is going on with compensation committees? After all, the majority of board members are either major donors, captains of industry or both. But as Alex points out, the double digit millions in CEO compensation is a small sliver of the proceeds after expenses. I assume a highly paid and scary CEO can wrangle the insurance carriers. That's probably the job and most likely the compensation metric most influential.
There is such a thing as a private anti-trust claim. The pharmaceutical industry faces these all the time. These big healthcare conglomerates, University of Pittsburg and the University of Pennsylvania are the big ones in the Commonwealth, can act as local monopolies, as individuals are not willing to travel great distances to receive care. It should be a slam dunk to show anti-competitive behavior. You just need a plaintive to file a case.
Private capital underpins the consolidation you describe, putting the entire vertical in a couple of large health care providers. Retiring physicians with a practice they've built over decades sell to these health care giants. Why? Because the cost of doing business in a HIPPA / Electronic Records world makes consolidation economically advantageous. Indeed, there are no takers for the small (half dozen MD partners) practices in specialty areas that can pay what a big hospital group can pay.
Litigation to break up the monopolies is like pushing back against the ocean tide. Regardless the belief that these deals are anti-competitive, unless you forbid doctors from selling their lifes' equity to the highest bidder, they will continue. And when you forbid such sales, you create struggling practice entities unable to access needed capital to keep up with advances in care.
In the current regulatory and reimbursement environment, big is more efficient. I'd add that moving it all to a single payer would exacerbate this trend hugely.
Hospital prices are works of fiction. The CFO goes into a room and come up with the largest number that won’t get him laughed out of the board room and then the board jacks up the number by 20% annually. medicare and Medicaid pay a set amount per diagnosis. Insurance companies negotiate. The only people who pay the price are those without insurance and substantially high assets the rest just throw the bill in the garbage.
That said this article is entirely true. Hospital consolidation and the death of the physician’s practice as an independent business has cemented this monopoly.
The Swiss a the only ones that have cracked the medical cost code. The did not allow hospital or health plan mergers. But most importantly they don’t have government or employer based insurance. People purchase their own coverage. So they care about cost because they purchase high deductible insurance so they pay for most of their healthcare out of pocket. So there is price competition. So it turns out when something appears to be free like US healthcare, it is really expensive.
Whenever your government is misgoverning something, find out what Switzerland does, that's most likely the right thing or something better. They have the best health system in the world. It also helps that the Swiss walk regularly up and around mountains. The Swedes did better during CovidMania, though.
Ummmm, the report was released last week and you already expect, no, not expect, you are already criticizing: "the Trump Administration has not proposed changing regulations or laws to do so".
Many times people have commented on his lagging some time after he might have jumped on something, and then after time passes we hear he's put out a cohesive plan to move forward on the issue. So could we allow a bit of time here? This problem of the recent hospital consolidation/monopolization at the local level is a massive Gordian knot with many people benefiting from stagnation in the situation.
I seem to remember you (Alex) taking years to make the simple decision to vote for Trump at this last election when it was clear Biden had problems during his 2020 campaigning. And that was a no-brainer. This problem of the hospitals, by contrast, will require serious strategizing.
I believe Obamacare accelerated the increase in this kind of asinine healthcare costs. What exactly did Steven Corwin do be so handsomely compensated? Did his sterling administration save more lives? Seems unlikely. More "revenue less expenses" are probably his stock in trade.
Health care consolidation was already gaining momentum before ObamaCare, but it introduced specific structural incentives that accelerated horizontal mergers between hospitals and the vertical acquisition of independent medical practices. The primary drivers behind this wave of consolidation involved the intentional shift toward risk-based payment models, the heavy capital requirements of new compliance mandates, and the financial exploitation of federal reimbursement structures.
A central goal of the legislation was to transition the American health care system away from traditional fee-for-service medicine and toward value-based care, which ties financial reimbursement to patient outcomes and cost reduction. The primary vehicle for this transition was the Accountable Care Organization, a network of doctors and hospitals that coordinates care and shares financial risk for a specific population. To manage this collective risk, track patients across multiple care settings, and prevent patients from seeking care outside the network, health systems required massive scale. Smaller community hospitals and independent physician groups lacked the capital and administrative infrastructure to take on these global risk-sharing arrangements, which prompted them to merge with or sell to large regional hospital networks.
At the same time, the regulatory environment grew significantly more complex with mandates for meaningful-use Electronic Health Records and strict reporting metrics for quality compliance. Implementing and maintaining enterprise-level software systems requires millions of dollars in upfront capital and ongoing technical support. Large hospital networks could easily absorb and spread these high fixed overhead costs across a massive patient base, whereas independent practices and small rural hospitals faced a prohibitive financial burden. This regulatory overhead forced many smaller entities to seek shelter under the corporate umbrella of dominant regional systems.
ObamaCare also accelerated vertical integration due to how federal reimbursement rules treat hospital-owned settings compared to independent ones. When a large hospital network acquires an independent doctor's office, the clinic can be reclassified as a Hospital Outpatient Department. Under Medicare and commercial insurance rules, these hospital-owned departments are permitted to charge a secondary facility fee on top of the standard professional fee for routine office visits, imaging, and diagnostic tests. Because the exact same service becomes vastly more lucrative when delivered by a hospital employee rather than an independent physician, health systems aggressively acquired local practices to capture these fees and secure internal referral pipelines.
Obamacare forced the small independent docs to become associated w the hospitals or they couldn’t see their patients in the hospital. I was paying 55 dollars a visit to an independent doc before he recently retired. Only 53 dollars if I paid right after my visit. I received sticker shock when my new Nurse Practitioner was charging me 225 for the same visit. Not even the Doctor!!
This is a knee-jerk reaction, but I think there should be caps on what salaries any organization can offer and still have the tax benefits of a non-profit.
These hospitals aren’t using Drs. to steer patients to them. They own the Drs. too and make them follow their guidelines otherwise they might be denied use of said hospital. In my area Atlantic Health is our monopoly. They are a “non-profit” but it’s horse shit as in every town they have a hospital they have purchased most of the real estate around their hospitals. They use them to rent to employees or if it’s a building it will house Atlantic Medical Group or AMG doctors. They of course own that too. It’s almost impossible to find a Dr. around here not affiliated with AMG. It’s the biggest grift I’ve ever seen. They get tax breaks on houses that would sell for over a million dollars plus pay almost nothing in property taxes yearly while the rest of us pay full freight and it’s hefty here in NJ having the highest property taxes in the nation. Medicine has NEVER been not for profit and just because some Drs. have been paid in eggs or chickens in some other areas the non profit status is a scam and needs to be made illegal. I have so much information on this as my wife is an RN at one of their hospitals it makes me sick. The non profit looks nice for the public because I’ve heard people say “but they are non-profit” but that’s how they screw you. It’s all bullshit.
Having worked for and retired from a non profit health care organization I saw first hand how many physician practices became part of our organization. However, what drove many to our organization was fallout from the Affordable Care Act. In this bill were requirements to implement new coding standards. In order for these small businesses to become compliant with the new regulations there was going to be a very large outlay of dollars to upgrade their patient care IT systems to meet the deadlines for CMS. Many looked at that outlay and thought it would be easier to join our organization and have our IT department do the migration for them. Understand that many of these physicians were in their 50’s so retirement not that far away but we had many, many joining us. I’m not trying to negate anything in this piece about them raising costs but I do believe Obama Care pushed many small independent physician practices into the large health care systems.
That is what I recall as well. We even had one group (one of the last independent primary care practices) abruptly give their patients 30 days notice and close/retire. Unfortunately, patients were confused and continued to be so even after the situation was explained to them.
Alex the more you dig into the broken and corrupt medical system in this country the more desponded you will become every distortion has been caused by some government program designed to lower costs or improve access. It's just a matter of time before the government nationalizes healthcare and then ration it to lower costs to the masses while the elites will enjoy unlimited access to any medical care they want. Wonder where the Canadians will go when they can't get care there. The access to medical care here will be so restricted just like it is now in England and Canada, In fact England now has a category of people that they are tracking who died while they waited for their approved care.
I am a big proponent of hospitals advertising their pricing. However, that is not enough. If I need a procedure done (as I do), I want to know the price, and the success rate on that procedure. I also want to know hospital infection rate and percentage of complications. A procedure with a bargain basement price tag isn't of much value if the success rate is also low. As Dan Bongino often says, the goal here is "to not get dead".
Alex-please write more on this and when you do, explain why you cannot open a competing health facility without something known as a “certificate of need”. This sounds anti competitive on its face, but maybe it serves some purpose helpful to the consumer (as opposed to the hospital.)
The title is wrong. American healthcare cost families at least $30,000 a year. That is thee minimum cost of a typical family plan cost an employer. So that is compensation you are not getting in the form of wages. If you are single or on a spouse’s plan you are subsidizing your fellow employees. What type of a plan would you purchase if you received cash instead!? Would it cover trans surgery? Mental health? The only reason you rationally support this is because insurance is tax free compensation.
Hospital and insurance CEOs have near monopolistic pricing powers. Most illegals get free healthcare. Citizens foot the bill for all our healthcare needs.
The left hates monopolies unless they are unions, hospitals or government itself which is the biggest monopoly of all and has a monopoly on force. Coincidentally (/sarcasm) they want to control them all.
That's not entirely true. The old guard democrat big wigs like Schumer, Pelosi and the Clintons love monopolies, so long as they pay their tribute to the democrat party, as well as their personal foundations.
The true believer leftists, like this Chevallier character that just got herself elected to Congress, hate anything that charges people money, monopoly or not.
You are right, they don't like people voluntarily paying for things, they'd rather take it by force with a cut for themselves.
Thank you for staying on top of this important issue! The government should remove the non-profit status of hospitals, colleges/universities, and alleged religious organizations (think: Scientology). It is grossly unfair that my business pays taxes and they do not. I help a lot of people every day. Yet, I do not get any tax breaks. To exacerbate this discrepancy, I live in the incompetent dem-socialist state of California, where the state is essentially stealing my earnings. (Yes, I'm trying to get out.)
Taxing them won't change the nature of the tiger's stripes. It will cut into capital investment.
Maybe ask what is going on with compensation committees? After all, the majority of board members are either major donors, captains of industry or both. But as Alex points out, the double digit millions in CEO compensation is a small sliver of the proceeds after expenses. I assume a highly paid and scary CEO can wrangle the insurance carriers. That's probably the job and most likely the compensation metric most influential.
There is such a thing as a private anti-trust claim. The pharmaceutical industry faces these all the time. These big healthcare conglomerates, University of Pittsburg and the University of Pennsylvania are the big ones in the Commonwealth, can act as local monopolies, as individuals are not willing to travel great distances to receive care. It should be a slam dunk to show anti-competitive behavior. You just need a plaintive to file a case.
Private capital underpins the consolidation you describe, putting the entire vertical in a couple of large health care providers. Retiring physicians with a practice they've built over decades sell to these health care giants. Why? Because the cost of doing business in a HIPPA / Electronic Records world makes consolidation economically advantageous. Indeed, there are no takers for the small (half dozen MD partners) practices in specialty areas that can pay what a big hospital group can pay.
Litigation to break up the monopolies is like pushing back against the ocean tide. Regardless the belief that these deals are anti-competitive, unless you forbid doctors from selling their lifes' equity to the highest bidder, they will continue. And when you forbid such sales, you create struggling practice entities unable to access needed capital to keep up with advances in care.
In the current regulatory and reimbursement environment, big is more efficient. I'd add that moving it all to a single payer would exacerbate this trend hugely.
Hospital prices are works of fiction. The CFO goes into a room and come up with the largest number that won’t get him laughed out of the board room and then the board jacks up the number by 20% annually. medicare and Medicaid pay a set amount per diagnosis. Insurance companies negotiate. The only people who pay the price are those without insurance and substantially high assets the rest just throw the bill in the garbage.
That said this article is entirely true. Hospital consolidation and the death of the physician’s practice as an independent business has cemented this monopoly.
The Swiss a the only ones that have cracked the medical cost code. The did not allow hospital or health plan mergers. But most importantly they don’t have government or employer based insurance. People purchase their own coverage. So they care about cost because they purchase high deductible insurance so they pay for most of their healthcare out of pocket. So there is price competition. So it turns out when something appears to be free like US healthcare, it is really expensive.
Whenever your government is misgoverning something, find out what Switzerland does, that's most likely the right thing or something better. They have the best health system in the world. It also helps that the Swiss walk regularly up and around mountains. The Swedes did better during CovidMania, though.
bingo! "government or employee based insurance."
Ummmm, the report was released last week and you already expect, no, not expect, you are already criticizing: "the Trump Administration has not proposed changing regulations or laws to do so".
Many times people have commented on his lagging some time after he might have jumped on something, and then after time passes we hear he's put out a cohesive plan to move forward on the issue. So could we allow a bit of time here? This problem of the recent hospital consolidation/monopolization at the local level is a massive Gordian knot with many people benefiting from stagnation in the situation.
I seem to remember you (Alex) taking years to make the simple decision to vote for Trump at this last election when it was clear Biden had problems during his 2020 campaigning. And that was a no-brainer. This problem of the hospitals, by contrast, will require serious strategizing.
I believe Obamacare accelerated the increase in this kind of asinine healthcare costs. What exactly did Steven Corwin do be so handsomely compensated? Did his sterling administration save more lives? Seems unlikely. More "revenue less expenses" are probably his stock in trade.
Health care consolidation was already gaining momentum before ObamaCare, but it introduced specific structural incentives that accelerated horizontal mergers between hospitals and the vertical acquisition of independent medical practices. The primary drivers behind this wave of consolidation involved the intentional shift toward risk-based payment models, the heavy capital requirements of new compliance mandates, and the financial exploitation of federal reimbursement structures.
A central goal of the legislation was to transition the American health care system away from traditional fee-for-service medicine and toward value-based care, which ties financial reimbursement to patient outcomes and cost reduction. The primary vehicle for this transition was the Accountable Care Organization, a network of doctors and hospitals that coordinates care and shares financial risk for a specific population. To manage this collective risk, track patients across multiple care settings, and prevent patients from seeking care outside the network, health systems required massive scale. Smaller community hospitals and independent physician groups lacked the capital and administrative infrastructure to take on these global risk-sharing arrangements, which prompted them to merge with or sell to large regional hospital networks.
At the same time, the regulatory environment grew significantly more complex with mandates for meaningful-use Electronic Health Records and strict reporting metrics for quality compliance. Implementing and maintaining enterprise-level software systems requires millions of dollars in upfront capital and ongoing technical support. Large hospital networks could easily absorb and spread these high fixed overhead costs across a massive patient base, whereas independent practices and small rural hospitals faced a prohibitive financial burden. This regulatory overhead forced many smaller entities to seek shelter under the corporate umbrella of dominant regional systems.
ObamaCare also accelerated vertical integration due to how federal reimbursement rules treat hospital-owned settings compared to independent ones. When a large hospital network acquires an independent doctor's office, the clinic can be reclassified as a Hospital Outpatient Department. Under Medicare and commercial insurance rules, these hospital-owned departments are permitted to charge a secondary facility fee on top of the standard professional fee for routine office visits, imaging, and diagnostic tests. Because the exact same service becomes vastly more lucrative when delivered by a hospital employee rather than an independent physician, health systems aggressively acquired local practices to capture these fees and secure internal referral pipelines.
Excellent discussion of the issue. I had no idea!
Obamacare forced the small independent docs to become associated w the hospitals or they couldn’t see their patients in the hospital. I was paying 55 dollars a visit to an independent doc before he recently retired. Only 53 dollars if I paid right after my visit. I received sticker shock when my new Nurse Practitioner was charging me 225 for the same visit. Not even the Doctor!!
Wow!
He made roughly 1/22 of their profit? That is a good gig if you can get that. I'll do it for 1/100th.
Keep in mind that "profit" is determined by the accountants.
I don’t know you so it’s just a guess that you don’t have the talent. But don’t take that too hard. I don’t have the talent either.
Haha! That’s why I’d do it for 1/5 of what he is being compensated….you get what you pay for.
This is a knee-jerk reaction, but I think there should be caps on what salaries any organization can offer and still have the tax benefits of a non-profit.
These hospitals aren’t using Drs. to steer patients to them. They own the Drs. too and make them follow their guidelines otherwise they might be denied use of said hospital. In my area Atlantic Health is our monopoly. They are a “non-profit” but it’s horse shit as in every town they have a hospital they have purchased most of the real estate around their hospitals. They use them to rent to employees or if it’s a building it will house Atlantic Medical Group or AMG doctors. They of course own that too. It’s almost impossible to find a Dr. around here not affiliated with AMG. It’s the biggest grift I’ve ever seen. They get tax breaks on houses that would sell for over a million dollars plus pay almost nothing in property taxes yearly while the rest of us pay full freight and it’s hefty here in NJ having the highest property taxes in the nation. Medicine has NEVER been not for profit and just because some Drs. have been paid in eggs or chickens in some other areas the non profit status is a scam and needs to be made illegal. I have so much information on this as my wife is an RN at one of their hospitals it makes me sick. The non profit looks nice for the public because I’ve heard people say “but they are non-profit” but that’s how they screw you. It’s all bullshit.
Having worked for and retired from a non profit health care organization I saw first hand how many physician practices became part of our organization. However, what drove many to our organization was fallout from the Affordable Care Act. In this bill were requirements to implement new coding standards. In order for these small businesses to become compliant with the new regulations there was going to be a very large outlay of dollars to upgrade their patient care IT systems to meet the deadlines for CMS. Many looked at that outlay and thought it would be easier to join our organization and have our IT department do the migration for them. Understand that many of these physicians were in their 50’s so retirement not that far away but we had many, many joining us. I’m not trying to negate anything in this piece about them raising costs but I do believe Obama Care pushed many small independent physician practices into the large health care systems.
Exactly!
That is what I recall as well. We even had one group (one of the last independent primary care practices) abruptly give their patients 30 days notice and close/retire. Unfortunately, patients were confused and continued to be so even after the situation was explained to them.
Hell-th Insurance is the biggest racket going...
Never bought it, Never will.
Medicare is useless for people living a Holistic Life, because we never take pHARMA drugs.
only good for emergency room.
Alex the more you dig into the broken and corrupt medical system in this country the more desponded you will become every distortion has been caused by some government program designed to lower costs or improve access. It's just a matter of time before the government nationalizes healthcare and then ration it to lower costs to the masses while the elites will enjoy unlimited access to any medical care they want. Wonder where the Canadians will go when they can't get care there. The access to medical care here will be so restricted just like it is now in England and Canada, In fact England now has a category of people that they are tracking who died while they waited for their approved care.
I am a big proponent of hospitals advertising their pricing. However, that is not enough. If I need a procedure done (as I do), I want to know the price, and the success rate on that procedure. I also want to know hospital infection rate and percentage of complications. A procedure with a bargain basement price tag isn't of much value if the success rate is also low. As Dan Bongino often says, the goal here is "to not get dead".
Alex-please write more on this and when you do, explain why you cannot open a competing health facility without something known as a “certificate of need”. This sounds anti competitive on its face, but maybe it serves some purpose helpful to the consumer (as opposed to the hospital.)
The government does not require a certificate of need in any other industry. The judiciary should've shot down certificates of need decades ago.
The title is wrong. American healthcare cost families at least $30,000 a year. That is thee minimum cost of a typical family plan cost an employer. So that is compensation you are not getting in the form of wages. If you are single or on a spouse’s plan you are subsidizing your fellow employees. What type of a plan would you purchase if you received cash instead!? Would it cover trans surgery? Mental health? The only reason you rationally support this is because insurance is tax free compensation.
When is a profit not a profit? When a non profit makes a profit. Is this an oxymoron?
Meanwhile in Charlotte, Atrium CEO Gene Woods pulls down $25 million/year but still has time to lecture us on racism:
https://atriumhealth.org/dailydose/2020/06/02/whatever-affects-one-of-us-affects-all-of-us-a-message-from-eugene-a-woods