nurse standing by patient in hospital bed
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If one fact has come out crystal clear from the coronavirus pandemic sweeping the globe, it isthe critical importance of the physicians, nurses and nursepractitioners who have been working on the front-lines of thishealth care problem. Day in and day out, these brave men and womenwork for the betterment of their fellow man and we applaudthem.

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Yet over the past few decades, the doctor's temple, thehospital, has been corrupted by the exploiters of our health caresystem. Recent news about hospitals firing physicians and cuttingsalaries during this pandemic merely highlights a critical problemwe Americans have long swept under the rug: hospitals' primaryfunction is no longer to cure the sick, but rather to make money.As a result, massive consolidation of our health care deliverysystem combined with perversion of current regulatory structure isexacerbating the current coronavirus pandemic.

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Related: The ramifications of health care legislation in theage of coronavirus

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Certificate of need (CON) laws were created in 1974 aspart of the Health Planning Resources Development Act. The purposeof CON legislation was to prevent too many health care facilitiesfrom opening in a single geographic area. The idea being thatexcessive capacity from building too many facilities could resultin higher prices due to a lack of demand. Ergo, limit the number ofhospitals.

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While CON laws might be well intended, there are two key flawsin the way they are applied. First, CON laws set parameters notonly governing how many facilities can be built in a geographicmarket, but also how many ICU beds, ventilators and services may beprovided. The fundamental problem with CON laws is that they arebased upon locality, a geographic calculation which does notproperly take into account other factors, including populationdensity. As the coronavirus pandemic has shown us, populationdensity exacerbates the spread of disease, yet because of these CONlaws, hospitals are not adequately prepared to meet demand. Thevery spacing law used to prevent having "too many" health carefacilities has created a lack of beds and resources when a massivevolume of care is needed due to the pandemic.

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The second major flaw in CON laws is in how they restrictcompetition. When these regulatory measures were established in1974, the authors did not take into account the massive hospital system consolidation we'veseen today. Like the the banking industry, where local banksserving the local needs of the communities have essentially beenwiped out by large banks like JP Morgan Chase, Wells Fargo, Bank ofAmerica, Citibank, so too, have local hospitals been replaced bylarge national conglomerates.

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The once-private, small-town general practice physician has beenabsorbed by a practice group. That practice has been replaced by aclinic, and that clinic is now owned by a hospital. In 2012, only14 percent of physician practices were owned by hospitals. By 2018,a mere six years later, that number was a staggering 68percent.

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Additionally, only one-third of doctors surveyed in the 2018Survey of America's Physicians are now private-practice owners orpartners, with almost one half (49.1 percent) identifying as ahospital- or medial-group employee.

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We must learn our lessons from this pandemic and demand ourleaders act.

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First, Congress must restructure or completely eliminate theprotectionist platform of CON laws. Second, we must prevent furtherhospital and health care system consolidation by ensuring theFederal Trade Commission (FTC) and the Bureau of ConsumerProtection (CBP) forcibly apply existing anti-trust laws.

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Mergers increase prices in health care. While the health careconglomerates say it slims administration costs, it really doesn't.And today, as the conversation around price and access to healthcare during coronavirus sweep our nation, it is even more importantfor our leaders to prevent further consolidation until our healthcare system can recalibrate itself to normative competition andpricing.

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Seth Denson is an entrepreneur, author, speaker, politicalcommentator, national media contributor and 2019 BenefitsPRO Brokerof the Year finalist.  As a Healthcare Market Analyst,Seth co-founded GDP Advisors – a global consulting firm based inDallas, Texas.  

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