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Comment & Response
July 20, 2021

Strategies to Overcome the Market Dominance of Hospitals

Author Affiliations
  • 1Agilon Health, Long Beach, California
JAMA. 2021;326(3):277-278. doi:10.1001/jama.2021.6892

To the Editor In their recent Viewpoint,1 Dr Kocher and colleagues illuminated the concerning trend of hospital-dominated markets that has contributed to unsustainable growth in US health care costs. However, by focusing on managing vertical and horizontal consolidation, they addressed the symptom rather than the underlying disease. Through acquisition and organic growth, hospitals now employ more than one-third of physicians,2 driven largely by an economic model whereby the razor-thin profit margins of hospitals depend on highly reimbursed elective procedures to cross-subsidize essential but poorly reimbursed services, such as pediatrics, general internal medicine, and emergency care. The intrinsic inefficiency of this model was revealed in 2020, as hospitals lost money because lucrative elective procedures were canceled due to the COVID-19 pandemic.3