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Comment by ceejayoz | Hacker News Reader

All the little hospitals and clinics in our area have been bought up by one of the two healthcare networks in the five-county region, and I'm fairly shocked they haven't done this.

Maybe it's illegal for a hospital system to offer insurance in NY? I don't know. You'd think they'd be happy to cut out all the fuss around handling insurance approvals/rejections and pocket the 20% middleman cut.

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I don't have a ton of first-hand knowledge, but I know that being licensed to provide health insurance in NY specifically is no joke. Todd Park (former US CTO, AthenaHealth founder) once told me that he didn't pay much attention to Oscar early on until he found out they had gained an NY license, at which point he dove into it.

More broadly, many hospitals and hospital are getting involved in the ACO (accountable care org), which gets at some of these goals, but it's not 100% clear that an ACO model can be successful (financially or for patients), and it doesn't cut out all the relevant middle-men.

> Maybe it's illegal for a hospital system to offer insurance in NY?

Definitely not. A lot of hospitals are part of networks which are doing exactly this.

And many of the ones that aren't are entering long-term capitated agreements with insurers, which basically means they're acting as if they were insurers but without technically being one.

The consolidation is happening because there's a huge surplus of hospital beds and specialists in NY.

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