Health economist here. This matters A LOT. This is a big, big deal in terms of making prices higher. For all of the sh?t pharma companies get about high drug

Health economist here. This matters A LOT. This is a big, big deal in terms of making prices higher. For all of the sh?t pharma companies get about high drug prices (some of it quite well deserved), we spend _vastly_ more on hospitals - about four times as much. For a good source on specific numbers, see the Kaiser Family Foundation [1]. We spend a lot on healthcare in large part because hospital prices are high. Hospital prices are quite high in the US even though our utilization is lower than many other OECD countries. And let's not get started on our outcomes which (certain cancers excluded) are frequently a lot worse than countries which spend a small fraction of what we spend. If some of these markets can be made more competitive (no easy feat - this executive order is step 0 at best), that has the potential to make prices meaningfully lower, though note that that would be achieved by an insurer excluding from its network one high-priced hospital in favor of a lower price hospital (or threatening to do so). For a specific example in a large market, consider the case of the Jefferson health system in Philadelphia, which is now a nearly-20-hospital behemoth - the Philadelphia Inquirer did a nice article covering the release of documents as a result of an FTC lawsuit concerning their acquisition of the Einstein system [2]. It is clear from the unearthed documents that the CEO of the system understands perfectly well what he is trying to do with his acquisitions: "We [Jefferson] have to continue strategically on the path to essentiality and Einstein is the key". What this means is that he wants his system to be so large and systematically important that every insurer in the market MUST deal with him (and pay his prices). AFAIK the Biden administration dropped its objection to the acquisition of Einstein by Jefferson. Here their concern was one of the other problems in applied anti-trust law: it might be the case that a firm either gets acquired or exits the market (goes bankrupt). That is (apparently) a concern with Einstein. Whatever the truth is about the future of Einstein absent a merger, I would expect that hospital prices in Philadelphia will increase at an even higher rate than before in the next few years. [1] https://www.kff.org/interactive/health-spending-explorer/ https://www.kff.org/interactive/health-spending-explorer/ [2] https://www.inquirer.com/business/health/jefferson-einstein-health-valuation-philadelphia-ftc-challenge-20200316.html https://www.inquirer.com/business/health/jefferson-einstein-...