Hospital mergers drive up US healthcare costs by 25% in major cities

Hospital mergers across the US have pushed up healthcare costs in recent years. A wave of consolidation between 2021 and 2026 has left many cities with fewer choices—and higher bills. New studies now show how reduced competition is hitting patients' wallets hard.

Over the past five years, large hospital systems have joined forces at a rapid pace. By 2025, research from the Health Care Cost Institute revealed that prices in major metro areas like New York, Los Angeles and Chicago had jumped by 15–25%. The Federal Trade Commission and RAND Corporation linked these rises directly to fewer competing providers.

In half of America's metropolitan regions, just one or two hospital networks now control most services. Without rivals nearby, these systems face little pressure to keep costs down. Hospitals with no competitors within 15 miles charge 12% more on average than those in areas with four or more providers. The Lehigh Valley in Pennsylvania offers a stark example. After Lehigh Valley Health Network merged with Jefferson Health, prices surged. Lehigh Valley Hospital-Hazleton now bills patients 335% of Medicare rates for some treatments. The deal also squeezed St. Luke's hospitals, leaving them with a smaller share of the local market.

The trend toward hospital monopolies shows no signs of slowing. Patients in consolidated markets pay more for the same care, with fewer alternatives available. Studies confirm that without competition, prices will likely keep climbing in the years ahead.