Competition and Pricing by Nonprofit Hospitals: A Reassessment of Lynk's Analysis

A recent paper by Lynk challenges the conventional application of antitrust laws to mergers of nonprofit hospitals. Examining 1989 data from California, he concludes that nonprofit hospital mergers will lead to lower prices. We believe that Lynk's methods may generate biased estimates. When we correct for some of the possible biases, we are unable to support Lynk's findings.