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ANTITRUST LAWS HINDER HOSPITAL COLLABORATION, AHA REPORT SAYS

 ANTITRUST LAWS HINDER HOSPITAL COLLABORATION, AHA REPORT SAYS
 /ADVANCE/ CHICAGO, Nov. 5 /PRNewswire/ -- Federal antitrust policy should be modified to encourage and not impede hospitals in their efforts to reduce costs and increase efficiency, the American Hospital Association said.
 In a report, "Hospital Collaboration: The Need for an Appropriate Antitrust Policy," the AHA says a combination of inconsistencies in antitrust laws and the way they are enforced stop some collaborative arrangements between hospitals and slow down others. The report cites an excess capacity of inpatient hospital beds and duplication of services in U.S. hospitals which could be reduced with modifications of antitrust law enforcement.
 "Current law places greater emphasis on competition and market concentration, rather than on the efficiencies that can be achieved through collaboration," says Fredric J. Entin, AHA general counsel. "The health care field is being compared to industry and the theory is that more competition will lower prices. Numerous studies regarding hospital markets cast doubt on this theory. In health care, collaboration can reduce wasteful and expensive duplication of equipment, facilities and services."
 A recent government study of hospital mergers points out the cost differential when hospitals collaborate. The inspector general of the U.S. Department of Health and Human Services compared the cost performance of 11 merged hospitals to a control group of non-merged hospitals. The June 1992 study concluded that the merged hospitals reduced their medical and other service costs by 10.4 percent while those in the control group experienced an increase of 29.7 percent.
 Recent attempts at hospital mergers underscore the inconsistencies of enforcement. The Federal Trade Commission challenged a proposed merger between two hospitals in Augusta, Ga., which would have left four remaining hospitals in the community. In contrast, mergers between the only two hospitals in Racine, Wis., and the two hospitals in Danville, Ill., went unchallenged.
 Another example of a thwarted attempt at collaboration occurred when the Wichita Chamber of Commerce asked the FTC if local hospitals and business leaders could meet collectively to allocate hospital and health care services. The FTC said such activities would be considered illegal.
 The AHA said community attempts at reducing costly overcapacity and unnecessary duplication of health care services should be encouraged, not prohibited by antitrust laws. "The Wichita case is ironic since businesses typically are large purchasers of hospital and other health care services and have the incentive to keep costs down," says Entin.
 The AHA, a not-for-profit organization, serves as a national advocate for hospitals and the patients they serve, provides education and information for its members and informs the public about hospitals and health care issues.
 -0- 11/6/92
 /NOTE: A copy of the report or the executive summary is available by calling 312-280-6340./
 /CONTACT: Donna Gaidamak of the American Hospital Association, 312-280-6129/ CO: American Hospital Association ST: Illinois IN: HEA SU:


DC -- DC017 -- 7765 11/05/92 13:25 EST
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Date:Nov 5, 1992
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