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San Ramon Regional Medical Center is set to be sold in full to John Muir Health, pending the approval and completion of a nine-figure deal with the current majority owner, Tenet Healthcare.
John Muir officials announced the deal on Wednesday in which Tenet Healthcare has agreed to sell its majority interest in the hospital — 51% — to John Muir Health for $142.5 million, which currently has a 49% interest. The transaction, which is subject to review by federal regulators, would make John Muir Health the sole owner.
“We believe that this acquisition is good for our community, caregivers, patients, and John Muir Health and San Ramon Regional Medical Center,” said Mike Thomas, president and CEO of John Muir Health.
John Muir Health previously invested nearly $100 million for its 49% stake in SRRMC in 2013, and partnered with Tenet Healthcare on their outpatient center in Pleasanton, which broke ground in 2015.
John Muir Health officials said that the local nonprofit healthcare system’s goals in numerous ways, including the integration of SRRMC into JMH’s electronic health record throughout their system, Epic, extending programming and investing in facilities and services at SRRMC.
“We view this as a long-term opportunity to expand our services and better serve the growing populations in the San Ramon Valley and Tri-Valley. By allocating fixed costs over a broader scope of operations, we will also improve cost effectiveness for patients and health plans,” Thomas said.
SRRMC is currently headed by CEO Ann Lucena, who took the torch from previous CEO Gary Sloan in 2018.
The deal is expected to be finalized this year, pending closing conditions that include approval by the Federal Trade Commission, with Tenet retaining majority interest in the hospital until then.
Consolidation until there is one
Consolidation has been rampant in the healthcare industry for 25 years now. There are a handful of big players executing the same strategy across the country:
1) Buy up hospitals, medical centers, medical technology providers, and medical groups.
2) Consolidate by closing least-profitable facilities, cutting staff and reducing costs.
3) Raise prices
4) Use market power to achieve ever-increased profits.
The results are high prices.
SOURCE: CNBC
The highest average prices for vaginal deliveries likewise were in California, in Sacramento, where the average was $15,420. San Francisco’s average was a close second, at $15,204.
Those eye-popping averages compare to an average price of $8,857 for vaginal deliveries in Charlotte, North Carolina, which holds 16th place for U.S. cities for its price for that type of delivery.
Nothing good ever happens as a result of John Muir Health taking over anything.
This is why JMMH should be stopped from acquiring SR Regional.
US Health Care Is a Conglomerate of Monopolies
There are many reasons for why U.S. health care is so exorbitantly expensive, but one of them is because it’s a monopoly or, as Dr. Robert Pearl, former CEO of The Permanente Group, describes it, “a conglomerate of monopolies.” In a January 16, 2023, Forbes article, he writes:
“In any industry, market consolidation limits competition, choice and access to goods and services, all of which drive up prices. But there’s another — often overlooked — consequence. Market leaders that grow too powerful become complacent. And, when that happens, innovation dies.
Healthcare offers a prime example. De facto monopolies abound in almost every healthcare sector: Hospitals and health systems, drug and device manufacturers, and doctors backed by private equity. The result is that U.S. healthcare has become a conglomerate of monopolies.
For two decades, this intense concentration of power has inflicted harm on patients, communities and the health of the nation. For most of the 21st century, medical costs have risen faster than overall inflation, America’s life expectancy (and overall health) has stagnated, and the pace of innovation has slowed to a crawl …
[M]erged hospitals and powerful health systems have raised the price, lowered the quality and decreased the convenience of American medicine.”
According to Pearl, 40 of our largest health care systems combined own 2,073 different hospitals. That’s approximately one-third of all emergency and acute care facilities in the country. The top 10 health care systems combined own one-sixth of all hospitals and have an annual net revenue of $226.7 billion.
While there are all sorts of antitrust and anticompetitive laws on the books, “legal loopholes and intense lobbying continue to spur hospital consolidation,” Pearl says. As a result of all this consolidating, hundreds of communities have just one option