Study quantifies extreme consolidation of inpatient hospital care in U.S. metro areas

Health policy organization KFF on Friday published an updated study that finds just one or two health systems controlled the entire market for inpatient hospital care in nearly half of U.S. metropolitan areas in 2024.

“Consolidation may allow providers to operate more efficiently and help struggling providers keep their doors open in underserved areas, but it often reduces competition,” KFF researchers write. “A substantial body of evidence has found that consolidation can contribute to higher prices, with unclear effects on quality.”

The study’s key takeaways:

• One or two health systems controlled the entire market for inpatient hospital care in 47% of U.S. metropolitan areas in 2024.
• One or two health systems controlled more than 75% of the market in 83% of U.S. metropolitan areas.
• 97% of metropolitan areas had highly concentrated markets for inpatient hospital care when applying Herfindahl-Hirschman Index thresholds from antitrust guidelines.
• 80% of hospital markets in U.S. metropolitan areas became less competitive from 2015 to 2024 or were controlled by one health system over that entire period.

Read the full study and dive into its methodology here.