Healthcare Quote of the Day

In this New York Times article, they discuss the consequences of the increasingly frenetic pace of mergers among hospitals.

One line of the story is particularly important:

“The rhetoric is all about efficiency,” said Karen Ignagni, the chief executive of America’s Health Insurance Plans, a trade group that represents insurers. “The reality is all about higher prices.”

Notwithstanding any "efficiencies", the price hikes come from the fact larger chains have more pricing power when negotiating with insurance companies and the government.

It serves to illustrate a point: We do not have a healthcare cost problem in the United States, we have a healthcare price problem in the United States.

This is a classic case of a market failure.