Study extends benefits of hospital mergers to hospitals in close proximity

Hospital mergers result in even greater efficiencies and savings when the acquired hospitals are in close proximity, according to a new report by Charles River Associates prepared for the AHA. The report highlights results from a number of studies, including an update to an earlier CRA study that found hospital mergers reduce costs by harnessing operational efficiencies that can’t be gained through looser affiliations, improve quality and expand the scope of services available to patients. Building on the prior research, the updated study looked at the distance between the acquired hospital and the nearest hospital in the acquiring system and found that annual operating expenses fell by 2.8 percent or $6.6 million when they were less than 30 miles apart. On Dec. 12, AHA released a report highlighting how hospitals and health systems are investing, integrating and transforming to aid in the shift to value-based care.