KFF Health News: Rising Costs as Health Companies Expand—Will Trump’s Team Step In?
November 10, 2025
KFF Health News: As Health Companies Get Bigger, So Do the Bills. It’s Unclear if Trump’s Team Will Intervene.
Imagine a cancer patient living in a town with four oncology groups, yet only one accepts his insurance—the one owned by his insurer. A young couple might face substantial bills after their child is born, as their insurer has agreed to the health system’s rates in exchange for a contract with obstetricians nationwide. A woman may find herself paying an exorbitant amount for basic lab tests at a hospital—costs inflated because her insurer accepted them to ensure access to the system’s children’s hospital located elsewhere in the state.
Even those with good insurance are not immune to unaffordable bills in this era of high-deductible health plans, narrow insurance networks, and 20% cost-sharing. Health systems, doctor groups, and insurers are merging into larger entities, and while these mergers may benefit businesses, studies indicate that this consolidation is driving up prices, harming patient outcomes, and reducing choices for those in need of care. A recent study revealed that six years after hospitals acquired others, they raised prices by 12.9%, with those engaging in multiple acquisitions seeing a 16.3% increase.
Barak Richman, the Alexander Hamilton professor of business law at George Washington University, describes these new deals as “mutually enforced monopolization.” He argues that this is not competition but rather collusion, where price concerns are disregarded.
The impact of these market dynamics is stark. For instance, a dose of the antiviral Paxlovid given in a hospital can cost $4,500, while a magnetic resonance imaging (MRI) scan may set patients back $15,000, and joint replacements can reach $100,000.
President Donald Trump has long discussed the burden of healthcare costs, yet his administration appears less inclined to intervene in health mergers compared to his predecessor. This summer, he revoked President Joe Biden’s 2021 directive aimed at ensuring competitive markets, signaling a shift from Biden’s broader interpretation of antitrust law. Upon taking over the Federal Trade Commission (FTC), Trump-appointed chair Andrew Ferguson criticized his predecessor, Lina Khan, for what he deemed overreach and “clumsy” rhetoric regarding private equity’s role in healthcare.
What this means in practice remains uncertain. In an interview with KFF Health News, Daniel Guarnera, director of the FTC’s Bureau of Competition, stated that the current leadership has endorsed guidelines from the Biden administration, which serve as a “framing device” for companies considering mergers.
The expanded merger guidelines issued in 2023 focus on various new anti-competitive practices that have emerged in healthcare, such as hospitals and private equity firms acquiring doctors’ practices and insurers owning specialty pharmacies to dispense complex and often costly medications.
Guarnera emphasized that regulators’ strongest enforcement tool is demonstrating that mergers violate the Clayton Antitrust Act, a cornerstone of antitrust law. However, interpretations of this statute can vary between administrations, leaving it unclear which cases the Trump administration’s FTC will pursue.
“The Biden administration tried to be more innovative,” noted Erin Fuse Brown, a professor at Brown University’s School of Public Health. “The Trump administration has signaled a more traditional approach—unwilling to push the envelope.”
In the ongoing battle for profits between insurers and providers, both sides argue that growth is necessary to gain leverage in negotiations that determine healthcare prices. However, evidence suggests that the prices established in industry-level negotiations often bear little relation to the actual value of the services provided. Instead, they reflect the power dynamics between the negotiating parties.
Under Trump, the FTC has already moved to block two mergers of medical-device manufacturers and has continued the Biden administration’s challenges against individual drug patents. Guarnera stated, “Helping improve the healthcare system by ensuring more and better competition is a high priority for us at the FTC,” highlighting the significant impact healthcare has on Americans’ finances and well-being.
Despite a dip in new mergers earlier this year as companies navigated uncertain economic conditions, consolidation persists. A recent Becker’s Hospital Review article identified “28 large health systems growing bigger,” emphasizing that this is not an exhaustive list.
For instance, in May, Northwell Health of New York merged with Connecticut’s Nuvance, creating a 28-hospital entity with over 1,000 outpatient clinics. This merger exemplifies a traditional approach, where regional hospitals join forces to enhance their reach and market power.
Meanwhile, companies are forming unprecedented powerhouses in healthcare by acquiring smaller entities that do not trigger federal review. These vertical mergers involve companies providing different functions within the same industry, such as hospital systems or insurers purchasing doctors’ practices or specialty pharmacies.
For example, UnitedHealth Group, the largest healthcare company globally, now owns health insurance plans, physician practices, data services, payment processors, a pharmacy benefits manager, and pharmacies. Jonathan Kanter, the competition czar in Biden’s Justice Department, has likened UnitedHealth’s consolidation to Amazon.
Hospital systems and private equity firms are also expanding their reach across regions, acquiring hospitals, medical practices, and surgery centers. This type of consolidation, known as a cross-market merger, enables companies to amass large collections of doctors and significant market power across various specialties, such as gastroenterology, pediatrics, and obstetrics.
Research indicates that a change in ownership often leads to a change in prices. While pediatrics and obstetrics have historically been underpaid specialties, they are increasingly attractive to investors due to parents’ willingness to pay more for their children’s care.
Regulators once found it relatively straightforward to identify when a hospital merger resulted in monopoly power, leading to anti-competitive practices and price hikes. However, health researchers argue that the new, complex types of deals complicate this assessment, making it harder to define the tipping point for anti-competitive behavior.
Even traditional vertical consolidation can pose risks, according to Richman. “Economic theory suggests it could be harmless, like a suit manufacturer opening a store, yet studies show in healthcare it leads to higher prices, poorer quality, and less choice,” he stated.
For instance, patients with Cigna health plans requiring expensive injectable prescriptions must use Accredo, the specialty pharmacy acquired by the insurer in 2018, even if another pharmacy offers a better price.
Economists are developing computer models to predict when patients will face higher prices and reduced choices due to these new types of consolidations. However, judges who could block these transactions remain “not convinced,” according to Daniel Arnold, a health economist at Brown’s School of Public Health.
Experts like Fuse Brown argue that new laws and enforcement tools are essential. “The old laws,” she stated, “are simply not calibrated to the complexity and novel types of mergers.”
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
November 10, 2025
KFF Health News: As Health Companies Get Bigger, So Do the Bills. It’s Unclear if Trump’s Team Will Intervene.
Imagine a cancer patient living in a town with four oncology groups, yet only one accepts his insurance—the one owned by his insurer. A young couple might face substantial bills after their child is born, as their insurer has agreed to the health system’s rates in exchange for a contract with obstetricians nationwide. A woman may find herself paying an exorbitant amount for basic lab tests at a hospital—costs inflated because her insurer accepted them to ensure access to the system’s children’s hospital located elsewhere in the state.
Even those with good insurance are not immune to unaffordable bills in this era of high-deductible health plans, narrow insurance networks, and 20% cost-sharing. Health systems, doctor groups, and insurers are merging into larger entities, and while these mergers may benefit businesses, studies indicate that this consolidation is driving up prices, harming patient outcomes, and reducing choices for those in need of care. A recent study revealed that six years after hospitals acquired others, they raised prices by 12.9%, with those engaging in multiple acquisitions seeing a 16.3% increase.
Barak Richman, the Alexander Hamilton professor of business law at George Washington University, describes these new deals as “mutually enforced monopolization.” He argues that this is not competition but rather collusion, where price concerns are disregarded.
The impact of these market dynamics is stark. For instance, a dose of the antiviral Paxlovid given in a hospital can cost $4,500, while a magnetic resonance imaging (MRI) scan may set patients back $15,000, and joint replacements can reach $100,000.
President Donald Trump has long discussed the burden of healthcare costs, yet his administration appears less inclined to intervene in health mergers compared to his predecessor. This summer, he revoked President Joe Biden’s 2021 directive aimed at ensuring competitive markets, signaling a shift from Biden’s broader interpretation of antitrust law. Upon taking over the Federal Trade Commission (FTC), Trump-appointed chair Andrew Ferguson criticized his predecessor, Lina Khan, for what he deemed overreach and “clumsy” rhetoric regarding private equity’s role in healthcare.
What this means in practice remains uncertain. In an interview with KFF Health News, Daniel Guarnera, director of the FTC’s Bureau of Competition, stated that the current leadership has endorsed guidelines from the Biden administration, which serve as a “framing device” for companies considering mergers.
The expanded merger guidelines issued in 2023 focus on various new anti-competitive practices that have emerged in healthcare, such as hospitals and private equity firms acquiring doctors’ practices and insurers owning specialty pharmacies to dispense complex and often costly medications.
Guarnera emphasized that regulators’ strongest enforcement tool is demonstrating that mergers violate the Clayton Antitrust Act, a cornerstone of antitrust law. However, interpretations of this statute can vary between administrations, leaving it unclear which cases the Trump administration’s FTC will pursue.
“The Biden administration tried to be more innovative,” noted Erin Fuse Brown, a professor at Brown University’s School of Public Health. “The Trump administration has signaled a more traditional approach—unwilling to push the envelope.”
In the ongoing battle for profits between insurers and providers, both sides argue that growth is necessary to gain leverage in negotiations that determine healthcare prices. However, evidence suggests that the prices established in industry-level negotiations often bear little relation to the actual value of the services provided. Instead, they reflect the power dynamics between the negotiating parties.
Under Trump, the FTC has already moved to block two mergers of medical-device manufacturers and has continued the Biden administration’s challenges against individual drug patents. Guarnera stated, “Helping improve the healthcare system by ensuring more and better competition is a high priority for us at the FTC,” highlighting the significant impact healthcare has on Americans’ finances and well-being.
Despite a dip in new mergers earlier this year as companies navigated uncertain economic conditions, consolidation persists. A recent Becker’s Hospital Review article identified “28 large health systems growing bigger,” emphasizing that this is not an exhaustive list.
For instance, in May, Northwell Health of New York merged with Connecticut’s Nuvance, creating a 28-hospital entity with over 1,000 outpatient clinics. This merger exemplifies a traditional approach, where regional hospitals join forces to enhance their reach and market power.
Meanwhile, companies are forming unprecedented powerhouses in healthcare by acquiring smaller entities that do not trigger federal review. These vertical mergers involve companies providing different functions within the same industry, such as hospital systems or insurers purchasing doctors’ practices or specialty pharmacies.
For example, UnitedHealth Group, the largest healthcare company globally, now owns health insurance plans, physician practices, data services, payment processors, a pharmacy benefits manager, and pharmacies. Jonathan Kanter, the competition czar in Biden’s Justice Department, has likened UnitedHealth’s consolidation to Amazon.
Hospital systems and private equity firms are also expanding their reach across regions, acquiring hospitals, medical practices, and surgery centers. This type of consolidation, known as a cross-market merger, enables companies to amass large collections of doctors and significant market power across various specialties, such as gastroenterology, pediatrics, and obstetrics.
Research indicates that a change in ownership often leads to a change in prices. While pediatrics and obstetrics have historically been underpaid specialties, they are increasingly attractive to investors due to parents’ willingness to pay more for their children’s care.
Regulators once found it relatively straightforward to identify when a hospital merger resulted in monopoly power, leading to anti-competitive practices and price hikes. However, health researchers argue that the new, complex types of deals complicate this assessment, making it harder to define the tipping point for anti-competitive behavior.
Even traditional vertical consolidation can pose risks, according to Richman. “Economic theory suggests it could be harmless, like a suit manufacturer opening a store, yet studies show in healthcare it leads to higher prices, poorer quality, and less choice,” he stated.
For instance, patients with Cigna health plans requiring expensive injectable prescriptions must use Accredo, the specialty pharmacy acquired by the insurer in 2018, even if another pharmacy offers a better price.
Economists are developing computer models to predict when patients will face higher prices and reduced choices due to these new types of consolidations. However, judges who could block these transactions remain “not convinced,” according to Daniel Arnold, a health economist at Brown’s School of Public Health.
Experts like Fuse Brown argue that new laws and enforcement tools are essential. “The old laws,” she stated, “are simply not calibrated to the complexity and novel types of mergers.”
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
