Garden State Times

According to the latest reports released in October by the State of New Jersey, Garden State residents are facing some of the highest healthcare costs in the nation,. In fact, per-person spending for adults in New Jersey that are insured through an employer is 15% higher per month than the national average, $659 per month compared to $575.

One major driver of these inflated prices? Healthcare mergers, which are fueling the rise of formidable monopolies that are largely unchecked. If the state wants to get serious about addressing affordability, New Jersey politicians need to put a sharper focus on regulating these consolidations. 

In 2024 alone, there have been three notable hospital system mergers in New Jersey, continuing a trend that historically has led to rapidly increasing healthcare costs.  

Research underscores the problem. A 2022 RAND Corporation review revealed that hospital mergers and other healthcare provider consolidations can lead to price increases of anywhere from 3% to 65%. A sweeping analysis of 1,164 mergers among the country’s 5,000 acute care hospitals from 2000 and 2020 found that the resulting price escalations fueled an additional $200 million in national healthcare expenditures within a single year.

But the detrimental impact of healthcare mergers extends beyond the cost of care alone.  

According to a 2024 study by the Physician’s Foundation, consolidations are worsening healthcare delivery by exacerbating physician burnout, reducing job satisfaction, and limiting access to care. This is a major issue when considering that New Jersey has a significant primary care physician shortage, with just 17 primary care physicians for every 100,000 residents. 

Nearly seven in ten physicians reported that these mergers hurt patients’ overall access to care. It’s alarmingly common for merged entities to implement rules prohibiting medical professionals from working for other healthcare systems and hospitals. Ultimately, these mandates create care monopolies that often leave undeserved communities more vulnerable, facing worsened facility and care professional shortages.  

Fortunately, regulators are taking note. 

In recent years, the Federal Trade Commission has taken decisive action to thwart several hospital mergers in New Jersey, specifically citing that the reduced competition could harm consumers. Notably, the FTC’s most prominent case was its blocking of the Hackensack Meridian Health and Englewood Health combination in 2022, citing concerns over higher patient costs and diminished service quality. By intervening to block these mergers, the FTC is sending a strong cautionary message to New Jersey’s hospitals that affordability and high-quality care are not subject to negotiation.  

Unfortunately, many  New Jersey hospitals remain undeterred and continue to pursue harmful consolidations to increase revenues and broaden their regional reach. Their actions will likely create even more regional monopolies that have increased leverage to jack up healthcare costs and reduce New Jersey residents’ access to vital treatments.  Without stronger state and federal oversight, New Jersey will see more regional monopolies that can raise healthcare costs while restricting access to care.  

For all these reasons and more, it is imperative that the New Jersey Department of Health works hand in hand with federal regulators at the FTC to guarantee that any proposed future mergers of healthcare systems in the Garden State serve the best interests of patients — prioritizing patient welfare over profit margins.  

Failing to do so puts New Jersey on the fast track to claim the dubious honor of having the highest healthcare costs in the nation. It’s a trend that must be reversed—not only for the sake of patient wallets but for the overall health of the Garden State. 

Zainab C. Khan, MPH is a health policy and public health specialist who has worked with state governments, the U.S. Centers for Medicare and Medicaid Services (CMS) and Centers for Disease Control and Prevention (CDC). She earned her MPH in health policy at Yale University.