Primary Care
Impact of primary care market mergers on quality: Evidence from the English NHS (Journal of Health Economics)
Yuan Lyu, Zhaocheng Zhang
This article examines the growing trend of market consolidation among primary care providers and assesses the impact of mergers and acquisitions on the English primary care market.
The authors first look at the reasons behind primary care mergers. They identify the three most significant issues as practitioners retiring (causing a small practice to merge with another), offices consolidating functions to practice more efficiently, and failing practices merging with another to avoid closure.
The authors provide an empirical analysis of the effects of provider mergers by assembling a dataset on English practice mergers from 2014 to 2018, examining the causes of these mergers, and employing a difference-in-differences analysis to assess any changes that occurred post-merge. They measure clinical quality using a third-party scheme, data from patient surveys, NHS payments to measure financial performance, and other practice- and local-level data.
While the authors find that certain aspects of clinical quality management and efficiency increase after the merger, clinic quality, chronic illness care, and patient satisfaction decreased more broadly and severely. While revenue per patient remained consistent post-merger, revenue per full-time physician increased by an average of 24% after the merger, implying further cost efficiency and potential for financial gain by increasing the number of patients assigned to a physician.
The article explores heterogeneous effects of the pre-merger size of offices, geographic regions, and merger motivations. Overall, patient satisfaction dropped in all mergers, regardless of size, and geographic region had no impact on quality or financial outcomes. The authors found motivation to have a substantial impact on quality outcomes, despite financial outcomes improving despite motivation. Efficiency-driven mergers were found to have the most negative effect on quality and patient satisfaction, while failure-driven mergers were found to improve quality and maintain patient satisfaction.
The authors also test the impact of market concentration on merger outcomes and found little impact. They explore alternative explanations through similar analyses of quality variations post-merge and report that staff workload adjustments are the most likely factor. They found this to be especially true in efficiency-driven mergers, where staff were already overworked.
While primary care mergers are becoming increasingly common, further research is needed to understand their impact on patient care and outcomes fully. While this article notes some improvements in healthcare administration, it reports overall declines in patient satisfaction, particularly in mergers driven by efficiency motivations. The authors advocate for more nuanced policy approaches that implement mergers where beneficial for practitioners and patients, and regulations that address mergers with negative implications for patients.
State Investments in Primary Care—5 Early Leaders of a Potential Policy Trend (JAMA Health Forum)
Sarah H. Brown, MD, Dru A. Ricci, BA, Ananya Tadikonda, BSPH, Zirui Song, MD, PhD
To increase cost efficiency and lower total expenditures, states are considering a wide range of policies. This article looks to identify trends in state primary care spending increases, alternative payment models (APMs), and various spending targets.
A growing number of states are considering increasing primary care spending to lower overall healthcare spending. The article assesses the policies of Oregon, Delaware, Colorado, and California that have required increases in spending, either through commercial and/or public insurers or state budgets.
The article also addresses a trend in which states are paying for primary care through alternative payment models and value-based payment models. The authors examine Rhode Island and Delaware, which have established minimum contributions of over 50% towards alternative payment models. Oregon and Colorado have also passed legislation encouraging alternative payment models.
The article also identifies a trend of increasing primary care spending and state management in total expenditures through policies in Rhode Island, Oregon, and Delaware. These policies introduce caps on hospital price growth, targets for growth in insurance spending, and caps on non-professional service spending.
No state has taken the same approach in maximizing cost efficiency for primary care. Rhode Island and Delaware have targeted commercial insurance practices, while Oregon and Colorado have expanded to public providers. States also differ in whether they combine primary care increases with more comprehensive caps on price or spending growth. Rhode Island caps hospital price growth, whereas Oregon and Delaware have passed price growth targets, and Colorado has not implemented either.
States may decide whether to implement primary care investment alongside more comprehensive spending or price caps. The article examines the potential benefits and drawbacks of establishing pricing and spending targets, as well as the associated risk of increased consolidation. The authors then consider the use of APMs to combat consolidation.
While there is little evidence to suggest that increasing primary care spending, shifting to APMs, or implementing spending targets without price caps will slow total spending, state policies play a crucial role in identifying trends to improve health access.
Price Transparency and Controls
For States With Cost Growth Targets, 2023 Spending Growth Was High Across The Board (Health Affairs)
Jessica Mar, January Angeles
Eight states established 2023 healthcare cost growth targets, which set annual maximum limits on the rate of increase in total state healthcare spending, to promote transparency and control rising healthcare costs. The article analyzes state reports to assess healthcare spending trends across insurers, providing a comprehensive view of statewide healthcare spending in five target states.
The article finds that Delaware, Massachusetts, Connecticut, Rhode Island, and Oregon exceeded their cost growth target by an average of 4.9%. In Delaware, Massachusetts, Oregon, and Rhode Island, Medicare and Medicaid spending increased at a faster rate than in previous years.
The article's assessment of these states found that hospital outpatient services and prescription drug spending increased significantly and were the primary drivers of spending, with the authors attributing drug spending to the rapid increase in usage of glucagon-like peptide one drugs. However, spending increased in all categories, namely hospital inpatient, physician, other professional, and other medical services, long-term care, and nonclaims.
The significant rise in spending and increasing demand for GLP-1 medications highlight the growing need for a policy response to healthcare spending and costs. Authors advocate for stronger price control policies, including comprehensive, cross-market approaches, state policies that reflect local market dynamics, as well as federal efforts against systemic cost drivers. The report also highlights the need to give state agencies enforcement authority to hold entities accountable for exceeding targets.
Trends in insurance rate filings suggest that healthcare prices are increasing, and states are responding by shifting from transparency policies to concrete actions that contain spending growth. State cost growth targets are critical indicators of healthcare costs. The 2023 report clearly highlights the need for government action to ensure access to affordable healthcare.
National Analysis of the Requirements and Implementation of State Prescription Drug Price Transparency Laws (The Milbank Quarterly)
Hannah Rahim, Aaron S. Kesselheim
The article examines the 21 states that have passed laws requiring manufacturers to disclose drug pricing information. Drug transparency laws are designed to prevent manufacturers from charging varying prices across payers, promoting accountability, price equity, and enabling policymakers to understand the complex drug pricing systems better. The assessment looks at the different laws and reporting mandates states have implemented, identifying the scope of the law, trigger for reporting requirements, data to be reported, entity the manufacturer must report to, reporting timeline, data transparency, post reporting requirements, enforcement processes, time limitations, and whether the law was amended.
Most states require the reporting of current wholesale acquisition costs, increased reporting, or both launch and price increase reports. While some states required reporting on all drugs, most implemented a cost minimum ranging from $10 to $ 400, or a price increase of 10-50%. Nearly all states imposed a reporting timeline, imposing a monetary fine for failure to comply. Many also required states to publish manufacturer data on a public website that shares factors that manufacturers have identified as contributing to price increases, including inflation, supply chain disruptions, increased manufacturing and advertising expenses, increased competitive value, high demand for patient assistance programs, high rebate demands from pharmacy benefit managers, and post–FDA approval regulatory commitments.
The article provides a detailed assessment of each state's laws, accompanied by charts for comparison. The article notes that six states published reports about the process of implementing drug price transparency laws. Several noted challenges in enforcing requirements and in obtaining reliable data from manufacturers. While only four states published reports on the impacts of their drug pricing transparency laws, they found that price reporting was beneficial in identifying high-cost drugs that create cost barriers for patients. California reported that the 60-day reporting window was particularly helpful to public health objectives, and Minnesota noted that posting information publicly was also beneficial.
The article notes the limitations of relying solely on wholesale acquisition costs and the benefit of obtaining more information about manufacturer costs to gain a comprehensive understanding. Furthermore, many states did not require manufacturers to explain why a price increased. While some critical information from manufacturers was not obtained, many states saw an increase in reporting as repercussions became more rigorous for manufacturers.
The article also explores lawsuits challenging robust drug price transparency laws in California, Oregon, and Nevada. The same lobbying organization brought forth claims under the patent, Commerce Clause, and Due Process clauses in all three cases. Ultimately, these lawsuits resulted in only reporting requirements and modifications to trade secrets in Oregon.
Drug price transparency laws have created some accountability among manufacturers and provided limited insights into drug manufacturing costs and pricing. However, there is no evidence that manufacturers have changed their pricing strategies or lowered prices in response to these laws.
AI Regulation
Role of the States in the Future of AI Regulation (JAMA Health Forum)
Michelle M. Mello, JD, PhD, MPhil, Peter B. Childs; Jessica L. Roberts, JD
The use of Artificial Intelligence (AI) in healthcare is increasing, including its application for prior authorization, other coverage determinations, diagnostic decisions, and the use of chatbots to direct patients. This article explores states’ growing concerns about regulating AI, despite federal attempts to limit states' intervention. Tech companies are concerned that a patchwork of varying state regulations may inhibit innovation and have lobbied against them. However, unless federal regulations are established, federal lawmakers cannot prohibit states from regulating at their discretion under the anti-commandeering doctrine. States have taken the lead in regulating AI, looking to one another for guidance in drafting legislation and prioritizing key issues.
The article assesses state legislation from January 2023 to June 2025, exploring the laws of several states that have regulated the use of AI in healthcare. State regulations have prioritized regulating insurance practices, addressing discrimination, and ensuring disclosure to patients. Several states have introduced bills limiting the use of AI in reviewing patient prior authorization claims, prohibiting reliance on, and discrimination based on, AI claims. Many states require disclosures to patients about AI usage, including by health professionals. The article also finds that state bills tend to imitate legislation from other states. While this creates a sense of cohesion, it also highlights the need for a sound and thorough policy from the outset. The article also notes that the principal focus of state legislation thus far has focused on consumer protections, which is typically a state issue regardless of federal policy.
While the article addresses the need for federal regulation to promote cohesion and innovation, it welcomes state intervention in the meantime. The article suggests that further state legislation be enacted to address potential physical harm to patients resulting from AI and to establish state AI governance processes.
Healthcare Corporatization
The Corporatization Deal — Health Care, Investors, and the Profit Priority (The New England Journal of Medicine)
Amitabh Chandra, Ph.D., and Mark Shepard, Ph.D
This article assesses the corporatization of medicine, explaining the needs and shortcomings in private practice that corporatization can fill and evaluating the costs and benefits. While corporatization can offer cheaper and higher-quality care by leveraging economies of scale, it may ultimately prioritize profits over patient care. The article highlights the implications of the healthcare market that hinder its functioning as a normal market, citing asymmetric information, corporatization that enables firms to build market power and increase prices, and a disconnection between product prices and value.
The article looks at several examples to assess the corporatization of healthcare, including IVF, nursing homes, and biopharmaceuticals. The author illustrates how IVF clinics benefit from corporatization due to its capital-intensive nature, measurable outcomes, and a competitive market that requires firms to compete on both price and outcomes. Alternatively, nursing homes deliver lower quality care and higher mortality rates after being corporatized. Many homes engage in financial practices that prioritize profit over patients. Since it is largely unregulated and patient outcomes are harder to measure, it is a field particularly susceptible to negative corporatization.
While biopharmaceuticals require significant investments that would likely not be possible without corporatization, the market is subject to rigorous clinical trials and is assessed by the FDA. Although patients may have asymmetric knowledge about the drugs, other actors can help them make informed decisions. However, corporatization may skew development away from patient needs and push towards decisions that do not prioritize patients.
The article explores various forms of funding that may support medical advancements, including government funding and non-profit models, while also noting the implications of these approaches. While critical of the faults of corporatization, the article recognizes its benefits and appropriate uses. The article also encourages alternative approaches to corporatization that emphasize quality measurement, reporting, and empowering regulators to enforce antitrust rules aimed at limiting market power and regulating prices.
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