Care coordination may lead to less competition, higher prices, article says

Better medical care may arise from new public policies to promote more coordination from hospitals, doctors and others in healthcare, but there may be a high price to pay, two economists cautioned in a new article.

More coordination may lead to less competition and greater leverage for hospitals and doctors to raise prices, wrote Katherine Baicker of Harvard University and Helen Levy of the University of Michigan, in a New England Journal of Medicine essay that outlines the tension and risks associated with growth of new healthcare payment models.

“Well-integrated provider networks may promote coordinated care that improves the allocation of healthcare resources, but they are likely to undermine competitive pressures to keep prices down while maintaining lower quality,” the authors wrote. “Coordinated systems may thus deliver the right care to the right patient at the right time, but at the wrong price.” Read more here.

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