Most of us 99%ers have at one time or another played the game, ‘If money were no object…’ Normally the question involves things like where you would live or what places in the world you would visit. As a sign of – how do we say this? – ‘the evolving demographic of my friend group,’ it was recently posted as ‘what body part would you have repaired?
For the 1%ers, it is not a way to jump start a dinner conversation, but a real question. Some build funny shaped rocket ships, some buy sports teams or islands.
John Arnold decided to use his fortunes to sue some hospitals. He is probably not worried about the rising price of gas, but he is hacked off at the rising cost of healthcare.
Arnold, who made his money as an energy trader at Enron and the got out before the collapse, and his wife Laura, through their philanthropic organization have awarded over $2.5 billion to address issues like gun control and criminal justice reform. They may be a redeeming footnote to the Enron debacle.
This time, they are backing a small law firm – Fairmark Partners – that has filed lawsuits against big health systems in Wisconsin, North Carolina, and Connecticut. This is not their first healthcare play. They’ve awarded over $350 million toward initiatives to influence healthcare policies and disrupt markets. They are working to bust up pharma monopolies and get a $30 per month insulin solution to market.
Beats another billionaire in space, doesn’t it?
The Fairmark lawsuits – targeting HCA in NC; Hartford Healthcare in CT; and Advocate Aurora in WI – are going after the systems for consolidating, then price gouging.
This may surprise you, but all three systems said the suits are baseless and they each have letters from their mothers saying what nice people they are.
A twist on these suits may be something that the Justice Department and Federal Trade Commission are watching. President Biden has targeted consolidations in general – and hospital systems specifically – for anticompetitive behavior.
Historically, the trustbusters focused on a single market – did a hospital merger give too much power in this or that city?
But these sprawling regional health systems bring unique leverage to the table to demand higher prices. By offering insurance companies an ‘all or nothing’ deal – you get all the facilities in our system or none of them – they put them over a barrel. For example, the payer might be able to live without a hospital in one area because there are alternatives, but in another market the system has the only hospital around and the payer has to have that facility for coverage.
Little Fairmark – Ok, you can play a lot bigger when a billionaire is writing checks – is taking on some of the behemoths in the industry. Not as exciting as a rocket launch, but it will be fun to watch.