One definition of a monopoly is “the exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices.” Don’t get me wrong, if I had total control of a geography or industry, I’d love to own it. Think about it, having the only lemonade stand in the middle of a desert would be a great business. Even better would be to own the lemonade grove where the lemons are grown, and the sugar plantations where the sugar comes from, and finally, the water supply. Now, that’s a monopoly.
Someone told me years ago that the reason that Johnstown, Pennsylvania was never able to survive the loss of Bethlehem Steel was that Bethlehem controlled all of the water in that area. Not having access to water for manufacturers is not any different than owning all of the lemon groves and sugar.
Recently, I read an article that a banker friend of mine gave me comparing hospitals and health systems to the banking industry. This article, compared everything that is happening in the healthcare world in this country to what has been happening to banks. It predicted that small and medium sized hospitals and health systems will continue to be forced into mergers and acquisitions in order to survive at any level. The Affordable Care Act has set financial and information technology requirements and rules that make it almost impossible to maintain independent hospitals and health systems over the long-haul.
Back in 1987 when managed care was penetrating our area, the prediction was that Pennsylvania would end up with three health systems representing the entire State. That prediction seems to be coming true. The banking article continued to put things in perspective as the “Too Big to FAIL” model grows in healthcare.
Pittsburgh is going through an interesting “monopoly or no monopoly decision making time” where two nonprofit Titans are clashing, and the money being used to wage this war, not unlike the wars in Iraq and Afghanistan is coming from us, the citizens. It’s interesting to calculate the costs of monopolies that, even in the nonprofit world, demonstrate a sort of capitalism run amuck. How can anyone mess with organizations that employ tens of thousands of people? Too big to fail.
So, the Affordable Care Act will change this country forever. Yes, there will be millions of people with insurance who lived before in fear of losing their homes, savings, and lives. Yes, there will be hope where before there was nothing but fear. The question becomes, however, will the health systems select the same model of mergers as the Defense, Airline, and the Banking Industries? Will physicians be commoditized? Will employees be placed on a long list where human beings can be moved and replaced like widgets and their value will be dictated by one source of power? Last week 800 nurses walked off the job at a regional health system, the following day, 200 replacement nurses were brought in to take care of the patients. This move represented the beginning of the end of an era. Too big to fail or to negotiate?
I’ve been in leadership positions in large health systems and small hospitals. I’ve started corporations, and run non-profits, but one thing I know for sure is that “Too Big to Fail” becomes a very dangerous place to live. When an organization can place an economic strangle-hold on the everyday people who need that service the most, customer care and service always suffers. I’m paying nearly a thousand dollars at 5:30AM tomorrow morning to fly one hour because of an airline monopoly. Customer service doesn’t matter when you own the market. Too big to fail allows corrupt investment bankers to walk free while for profit prisons continue to fill with people about which our system was too big to care. It’s a jungle out there!