What happens after anesthesia rollup acquisitions? Within six months, prices increase 18%. Within two years, they increase 25 to 30%. New working paper by my amazing student Aslihan Asil (on the law market this year!) and her co-authors: www.nber.org/papers/w33217 - ThreadSky

florianederer.bsky.social • 200 days ago

What happens after anesthesia rollup acquisitions?

Within six months, prices increase 18%. Within two years, they increase 25 to 30%.

New working paper by my amazing student Aslihan Asil (on the law market this year!) and her co-authors:
https://www.nber.org/papers/w33217

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ahumbleman.bsky.social•200 days ago

📌

jslozano.bsky.social•200 days ago

Super interesting paper!!

Although I expect market structure to have a similar aggregate cost effect across specialities I don't think the price effect will always be there.

The reason is pointed out in the paper: anesthesia billing is pretty unique.

jslozano.bsky.social•200 days ago

Anesthesia is one of the rare specialities that bills almost exclusively on a time-based system while externalizing the majority of the costs (the anesthetic medicines are billed primarily through the hospital pharmacy usually, not the professional claim).

jslozano.bsky.social•200 days ago

Every specialty yearns for the market power needed to successfully negotiate favorable payor contracts, driving up revenue. But unlike anesthesia, most specialties have more levers to pull than the unit cost of provider time - they can provide different kinds and amounts of care in the same time.

jslozano.bsky.social•200 days ago

Moreover, the drivers of increased revenue for a lot of provider organizations aren't tied to the cost of the care they give, but instead the rules surrounding reimbursement for care in the first place.

jslozano.bsky.social•200 days ago

The AMA's guide for providers going into payor contracting highlights this perfectly - it spends the majority of its time on rules around utilization management, reimbursement, appeal and considerably less on fee schedules.

jslozano.bsky.social•200 days ago

So in general we might expect that overall market consolidation leads to higher reimbursement for care in aggregate, but not always higher prices. This is because providers use market power to negotiate non-price aspects of reimbursement, and because they have more control over their care mix.

jillej.bsky.social•200 days ago

Some sunlight here is important TY

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