Duopoly:Monopoly or Ferret:Rat?

As I read Julie Donnelly's Boston Business Journal report about Howard Grant's testimony at the recent health care cost trends hearings, I was reminded of a humorous piece written by Art Buchwald many years ago.It was about competition between the two airlines who ran shuttle services between New York and Washington, DC. It went something like this:Art calls US Airways to complain: "I see you just raised your fares to New York.""Yes, we did that to compete against Pan Am. They just raised their fares.""Wait, I thought the idea of competition was to lower prices.""Why would we do that? If we lowered our fares, and they followed suit, it would be a race to the bottom. We would both lose money."Howard, who knows whereof he talks because of his experience with Geisinger Health System in Pennsylvania, was asking the state to refrain from prohibiting potential mergers between Lahey Clinic and other health provider organizations. Julie reports:Grant said several large, well-integrated systems will have a better chance at lowering costs by treating patients in the most affordable location. He pointed to Lahey Health’s success in directing more patients to less expensive Beverly and Addison Gilbert Hospitals.The cost containment law “will fail without the fragmented players coming together for legitimate competition, so we don’t cement in (price) disparities,” Grant said during Wednesday health cost hearings held by the state Health Policy Commission.Grant count...
Source: Running a hospital - Category: Health Managers Source Type: blogs