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Anne Arundel Medical Center in Maryland is merging with a local hospital. Photo: Anne Arundel Medical Center

The hospital industry isn't just consolidating among the titans. Deals are happening frequently at the local level, too.

Why it matters: Smaller hospital deals are just as important as large system mergers because local market power is paramount in health care — people usually get care close to where they live. A combined entity reduces competition, which could give it the upper hand in negotiations with commercial health insurers in its area.

The big picture: The number of hospital mergers and acquisitions in the first half of this year tracked in line with 2018 and featured deals with big players, according to an analysis from Kaufman Hall. Plenty of smaller transactions are rolling out now, too.

  • Louisiana: Ochsner Health System is taking over Lafayette General Health, a 7-hospital system with more than $750 million of annual revenue that is roughly 70 miles away from Ochsner's Baton Rouge facilities.
  • Pennsylvania: Lehigh Valley Health Network is acquiring Coordinated Health, a local network that has facilities in the same towns as Lehigh Valley. Coordinated Health and its still-current CEO recently paid a combined $12.5 million to the Department of Justice to settle claims they fraudulently overcharged for orthopedic surgeries.
  • Maryland: Anne Arundel Medical Center merged with Doctors Community Health System, creating a system with $1 billion in annual revenue. Their main hospitals are 20 miles apart.
  • Georgia: HCA Healthcare is looking to acquire a small hospital that would bulk up its presence in the Savannah metro area.

Between the lines: Hospitals contend their deals are about improving patient care. But their press releases and executives rarely, if ever, talk about the financial benefits of their new enhanced negotiating power.

  • If hospitals in smaller communities combine, commercial insurers will have a harder time excluding any one of them from their networks, even if a hospital has poorer quality or higher prices. This is commonly called "all-or-none" contracting, and it's been cited in the pending Sutter Health case.

State and federal antitrust officials also have fewer resources to investigate these kinds of regional deals, making it easier for those with antitrust issues to go forward.

Go deeper: A reality check on hospital mergers

Go deeper

6 hours ago - World

Over 170 Palestinians injured in clashes with Israeli police in Jerusalem

An injured man is carried away as Israeli security forces clash with Palestinian protesters at the al-Aqsa mosque compound in Jerusalem. Photo: Ahmad Gharabli/AFP via Getty Images

At least 178 Palestinians have been injured in clashes with Israeli police in Jerusalem, Reuters reported late Friday.

The big picture: The clashes come amid growing anger over the threatened eviction of Palestinians from their homes on land claimed by Jewish settlers in East Jerusalem. Tensions have also escalated in the occupied West Bank in recent weeks.

Updated 8 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Health: Coronavirus cases hit a seven-month low — Majority back vaccine proof requirements for travel, schools and work — The race to avoid a possible "monster" COVID variant.
  2. Politics: Oklahoma secures $2.6 million refund for hydroxychloroquine purchase — Why Biden's latest vaccine goal is his hardest yet.
  3. Vaccines: Pfizer begins application for full FDA approval of COVID-19 vaccine — Moderna says its COVID booster shot shows promise against variants.
  4. Economy: U.S. adds just 266,000 jobs in April, far below expectations — Americans' return to the skies could benefit smaller airlines.
  5. World: WHO authorizes China's Sinopharm COVID-19 vaccine for emergency use — Mixed response in Europe to Biden's vaccine patents bombshell.
  6. Variant tracker: Where different strains are spreading.

Ohio GOP censures Rep. Anthony Gonzalez over Trump impeachment vote

Photo: Bill Clark/CQ-Roll Call, Inc via Getty Images

The Ohio Republican Party on Friday censured Rep. Anthony Gonzalez (R-Ohio) and called for him to resign for voting to impeach former President Trump in January, Reuters reports.

The big picture: Gonzalez is the latest Republican lawmaker to be punished for voting to impeach the former president on a charge of inciting the deadly Jan. 6 insurrection.