Atrium Health Merger Could Affect What You Pay For Health Care

Atrium Health Merger Could Affect What You Pay For Health Care

Atrium Health, headquartered in Charlotte, has just announced it is merging with Wake Forest Baptist Health to create a new, even larger health system. What does this new merger mean for you?

What Is a Health System, Exactly?

A health system is a group of health care providers that all sit under one legal and financial umbrella. Most health systems contain one or more hospitals, plus physician practices and other provider locations. For example, health systems could own cancer centers, rehab facilities, medical imaging centers, or diagnostic laboratories, to name a few.

Atrium Health was a particularly massive health system. Before the merger, Atrium had 40 different hospitals and around 900 other care locations. After the merger, Atrium Health will have 42 hospitals and around 1,500 care locations. So what will this mean for you?

Atrium Health Merger May Affect Your Health Insurance Coverage, Premiums

Image courtesy of Atrium Health.

The biggest change for NC residents will likely be related to your health insurance. If you have private insurance, your insurer negotiates with different health care providers to decide which hospitals, doctors, and clinics they would like to work with. These are called “in-network” providers. If your health insurance company doesn’t have an agreement with a doctor or hospital, that provider is considered “out of network”. Typically, if you get care at a hospital or with a doctor that is in your insurers’ network, that care is much less expensive to you than if you go to an out of network provider.

Now that Atrium has more provider locations under it’s umbrella, it will likely try to re-negotiate terms with insurance companies. Because Atrium is such a big player in NC, many insurance companies will have little choice but to make Atrium one of their in-network providers. So some people in NC might benefit from the merger, as their insurance companies might make more doctors, clinics, and hospitals, eligible for in-network coverage.

However, there are likely to be some negative effects as well. When hospitals and health systems merge, they increase their negotiating power relative to health insurance companies. This means they can negotiate to be paid higher and higher amounts for providing care. If Atrium uses it’s new size to negotiate higher payments from your insurance company, you might see your premiums go up.

Merger and Vision for Health Innovation Could Be Good For NC’s Job Market

Atrium expects their expanded organization to employ over 70,000 people, many of them in NC. They also aspire to make NC a center of health care innovation.

As the healthcare field goes through the most transformative period in our lifetime… our vision is to build a ‘Silicon Valley’ for healthcare innovation spanning from Winston-Salem to Charlotte.”

Eugene A. Woods, President and CEO of Atrium Health

If they can realize this vision, that could be good news for NC’s health care job market. Not only would the state attract top clinicians and researchers, related industries like biotech could see a boost as well.

For the latest healthcare news in North Carolina, please visit our Health section.

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