Regarding Modern Healthcare's "Health system consolidation may be holding down healthcare employee wages," we are concerned about the article presenting the findings of a study on consolidation as established fact given that it is identified as a working paper and has yet to go through a rigorous peer review process.
Among the many serious concerns about the study are its lack of rigor in the definitions and assumptions it used, and absence of data on total compensation and the recognition of other obvious factors that could affect wage growth. All these factors may result in overstated or skewed results. For instance, the results are based on only 21 geographic areas out of almost 400 included in the study to make a link between wages and mergers, so its sample is largely not even statistically significant much less generalizable.
The study’s focus on wages as the sole measure of employee welfare, rather than total compensation is a material omission. Many hospital and health systems employers offer additional benefits, such as employer-sponsored insurance, time off, and education benefits to attract high quality employees.
The study also ignores other factors that could have affected wage growth, such as the cost of health insurance premiums, which increased significantly faster than workers’ earnings over the same period.
Melinda Hatton is AHA's General Counsel.