Integrated delivery networks (IDNs) and medical homes are all the rage among health wonks. The ability for patients to receive holistic are from multispecialty practice teams seems like it would be beneficial. While quality of care may (or may not) improve with more integrated care, provider consolidation may have one downside: higher prices. An NBER working paper by Baker, Bundorf and Kessler finds exactly this.
we find that generalist physicians charge higher prices when they are integrated with specialist physicians, and that the effect of integration is larger in uncompetitive specialist markets. We find the same thing in the reciprocal setting — specialist prices are higher when they are integrated with generalists, and the effect is stronger in uncompetitive generalist markets. Our results suggest that multispecialty practice has anticompetitive effects.
- Baker, Laurence C., M. Kate Bundorf, and Daniel P. Kessler. Does Multispecialty Practice Enhance Physician Market Power? No. w23871. National Bureau of Economic Research, 2017.