Friday, 22 March 2013

Merger Mania 8 - that's all folks.


I’m printing the report’s final conclusions in full because they are important. Every local campaign to prevent closures and mergers needs to have this in mind when they take on those pesky experts who ‘always know best’;


The literature on mergers between private hospitals suggests that such mergers often produce little benefit. Despite this, the UK government has pursued an active policy of hospital merger. These consolidations are initiated by a regulator, acting on behalf of the public, and justified on the grounds that they will improve financial performance, productivity or patient care. We examine whether this promise is met by exploiting the fact that between 1997 and 2004 in England around half the acute general hospitals were involved in a merger.

We examine the impact of mergers on a large set of outcomes including financial performance, productivity, waiting times and clinical quality and find little evidence that mergers achieved gains. While admissions and staff numbers fell relative to the pre-merger position, which is desirable if the regulator wanted to remove spare capacity, labour productivity did not rise and financial deficits increased. And while most measures of quality were unchanged, there is no indication of an improvement in quality to offset this poorer financial performance. Further, in already concentrated markets, mergers brought about lower reductions in capacity. This suggests smaller gains in these markets.

We therefore conclude that there seems to be little hard evidence that this attempt at government planning of hospital care has achieved much more than simply reducing hospital admissions. This removal of capacity may reduce patient welfare. We show that waiting times rose post merger; travel distances may also rise when hospitals are closed. Consolidation also downstream reduces potential competition, which has been shown in the UK market to have some beneficial effects on patient outcomes and length of stay (Gaynor et al 2010, Cooper et al 2011, Bloom et al 2010). Given this, it seems the English government should carefully consider potential losses before allowing more mergers between short term general hospitals.”

Worse for patients, worse for staff, cost more, did less but better for managers.

‘May reduce patient welfare” – kinda says it all, really.


I’m going to give us all a break (you can put the soggy ice pack back in the fridge for now) because whenever I do serious stuff, I lose nearly all my readers. 8 days ago I was getting over 30 hits a day – all gone now (nearly but not quite all gone – thank you for staying with me)

A good friend has suggested to me that my Blog would do much better if I just put up a video of myself doing a silly dance. Trouble is, he is probably right. Mind you, he has problems e-mailing, so what does he know?


But I am going to go on going on. Later on I’ll take a look at the ‘new’ policy of setting up independent ‘trusts’, and then letting them go ‘bust’.

It’s a ‘Free Market capitalist’ way of bringing about mergers. Except nothing is free and there is no market. Mind you it is the people’s capital, until we let them squander it all away.



At the start of this series, I sent an e-mail to Bristol University, warning them I’d been using their research, which seemed only fair. In fact, it’s just the Centre for Market and Public Organisation that’s in Bristol, the authors are based elsewhere.

One of the authors kindly sent me over a direct link to their article, which is well worth a look;

(Luckily, between you and me, I think I managed to get away with the whole ‘st#t-g#ek’ thing, phew!)



Neil Harris

(a don’t stop till you drop production)

Oh and I’ve got a new graphic:




                IS BUST!

I fear its going to get some use.

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