Health Affairs, 25, no. 1 (2006): 11-21 doi: 10.1377/hlthaff.25.1.11 © 2006 by Project HOPE	New Online   How Would Obama, McCain Cover The Uninsured?   Debating Cost Of Uninsured   Try Medicare-For-All   HA Blog Top 10

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Mission Vs. Market

Could U.S. Hospitals Go The Way Of U.S. Airlines?

The market for hospital services, like global markets in general, is becoming more competitive. Increased price transparency and focused competition can squeeze out inefficiencies, restraining prices and making some consumers better off. But competition can have a dark side. U.S. hospitals can treat Medicare and Medicaid patients at less than cost, care for the uninsured, and provide other money-losing services because they can cross-subsidize. By 2025 the need for general hospitals to cross-subsidize will greatly in-crease, but their ability to do so will be diminished. U.S. hospitals could begin to resemble U.S. airlines: severely cutting costs, eliminating services, and suffering financial instability.

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