Controversial health care mergers: Let no crisis go to waste 

When the Oregon Health Authority approved a controversial fast-tracked merger involving Optum in mid-March of this year, it made headlines across the nation. While this may be new information for some and old news to others, it’s vital we continue focusing on this issue, as hospitals and clinics continue to feel the effects of the infamous software hack that temporarily crippled our health care system earlier this year. 

Rather than being held accountable, Optum and UnitedHealth Group were given license to improve their position and protect a business line that enjoys a seeming monopoly. The community and our health care providers need clear answers and transparency to trust that their health care services will remain high-quality and patient-focused.

You may have heard that the Oregon Health Authority was raising questions about UnitedHealth Group and how it is handling its business. UnitedHealth is a giant in the health care industry, owning companies like UnitedHealthcare and Optum. Optum, in particular, manages doctors’ offices and clinics while also employing nearly 10% of all physicians in the United States. But certain actions by UnitedHealth Group are causing some to wonder if the company is acting appropriately, especially when it comes to a well-known medical group in Oregon called the Corvallis Clinic. 

Related: UnitedHealth reports strong earnings, despite Change cyberattack

The Corvallis Clinic is a major health care provider in Oregon with more than 600 employees and medical providers; however, the clinic has recently been facing severe financial problems. In order to stay afloat, the Corvallis Clinic decided to merge with Optum, hoping for financial support to keep its doors open. But while this might sound like a good solution, many are concerned about why the clinic was in such big trouble in the first place.

One significant issue was the cyberattack on another UnitedHealth subsidiary, Change Healthcare. This attack disrupted the processing of medical claims, which means many clinics and doctors haven’t been getting paid on time. This financial strain is a big reason why the Corvallis Clinic is struggling, as it has left them unable to collect reimbursements from both private insurers and the government. Unfortunately, this has also been the case for thousands of hospitals, pharmacies, and clinics around the country, which has weakened those organizations’ ability to provide patient care and fill prescriptions for patients who need them.

Some people suspect that UnitedHealth might be using this crisis to buy struggling clinics at lower prices. The attack earlier this year disabled the payment platform that processes claim submissions and reimbursements between insurers and providers. The disruption put a halt to most financial transactions, which left providers in a troublesome position. Some worry that UnitedHealth is taking advantage of a situation that it was arguably responsible for in the first place. 

Another concern is the lack of transparency. Both the Corvallis Clinic and UnitedHealth have not been very open about the financial details of the merger, including disclosing how much money UnitedHealth is offering, or the exact state of the clinic’s finances. This secrecy makes it hard for the public to trust that this deal is in their best interest, which is a valid concern.

People in the community are also increasingly worried about the potential impact on health care services when a major insurer also employs physicians and medical professionals. They fear that the quality of care might decline if the clinic becomes part of a big corporation like UnitedHealth Group. There are also concerns that the focus might shift from patient care to focus on shareholder wealth, and we have seen these kinds of concerns materialize already, particularly when private equity gains majority control of healthcare providers.

Also: FTC, DOJ’s new ‘anti-merger’ stance: How the feds will scrutinize health care in 2024

Government officials are also getting involved when it comes to ensuring that the Corvallis Clinic really needs this merger and that it’s not just a quick fix to let UnitedHealth expand its reach. These officials believe the community should have a say in what happens to their local healthcare providers and the Oregon Health Authority received the largest number of public comments in its history when it came to the sale of the Corvallis Clinic.

It’s crucial to ask whether UnitedHealth is genuinely helping or if it’s using its power to gain more control over health care. It’s also crucial to consider whether a catastrophic hack was leveraged to increase the insurance giant’s market share in markets where it would have been more difficult had the incident not happened at all. 

The lines between coverage and care continue to be blurred when insurance corporations step out of their lane and start to practice medicine, as well. Health care should always remain fundamentally about the relationship between doctor and patient, not corporation and shareholder.

David Balat is the founder of Healthcare Finance Specialists. He is a former hospital executive with over 20 years of health care industry leadership and executive management experience.

Balat has testified before the U.S. House Committee on Oversight and Reform in Washington, D.C., and before various House committees in the Texas state Legislature. He is a published author and op-ed columnist in Newsweek, U.S. News & World Report, Real Clear Politics, and other news outlets. He is also an active speaker and commentator on matters of health policy, health care finance, and health care reform.