What drives costs in the health care marketplace?

The New York Times examines how hospital mergers might be one of the health sector's overlooked cost factors while Reuters reports on a recent study that examines what variables cause physicians to order unnecessary tests.

The New York Times' Economic Scene: Health Care's Overlooked Cost Factor
When the Evanston Northwestern Healthcare Corporation merged its two hospitals with the neighboring Highland Park Hospital just north of Chicago 13 years ago, the deal was presented as an opportunity to increase efficiency and improve the quality of patient care. But when the Federal Trade Commission finally decided to look at the deal, it encountered an entirely different objective: to gain market power (Porter, 6/11).

Reuters: More Than Money And Lawsuits Drive Overtesting: Study
Despite reports that financial incentives and fear of lawsuits lead doctors to order too many heart tests, a new study of U.S. Veterans Affairs (VA) doctors suggests overtesting may be the result of more fundamental issues. Researchers at one Florida VA facility found its doctors, who don't get paid for the tests they order and are rarely sued, order as many unnecessary nuclear stress tests as doctors at traditional hospitals (Seaman, 6/11).