Roanoke and parts of Southwestern Virginia are pretty much a one-stop market when it comes to health care. Most of the hospitals are owned by the so-called "not-for-profit" Carilion Health System, a mega-health care giant that is driving up health care and insurance costs through lavish perks for executives and excessive charges for medical procedures.
In 1989, the U.S. Department of Justice tried but failed to prevent a merger between nonprofit Carilion Health System and this former railroad town’s other hospital. The merger, it warned in an unsuccessful antitrust lawsuit, would create a monopoly over medical care in the area.
Nearly two decades later, the cost of health care in the Roanoke Valley — a region in southwestern Virginia with a population of 300,000 — is soaring. Health-insurance rates in Roanoke have gone from being the lowest in the state to the highest.
That’s partly a reflection of Carilion’s prices. Carilion charges $4,727 for a colonoscopy, four to 10 times what a local endoscopy center charges for the procedure. Carilion bills $1,606 for a neck CT scan, compared with the $675 charged by a local imaging center.
Carilion’s market clout is manifest in other ways. With eight hospitals, 11,000 employees and $1 billion in assets, the tax-exempt hospital system has become one of the dominant players in the Roanoke Valley’s economy. Its dozens of subsidiaries include businesses ranging from athletic clubs to a venture-capital fund.
The power of nonprofit hospital systems like Carilion over their regional communities has increased in recent years as their incomes have surged. Critics charge this is creating untaxed local health-care monopolies that drive the costs of care higher for patients and businesses.
"It’s a one-market town here in terms of health care," says Sam Lionberger, who owns a local construction firm. "Carilion has the leverage."
Anyone who has encountered this health care monolith knows it is expensive and often unresponsive. It’s also sad that not one of the area’s many media outlets have uncovered the effect Carilion has had on heatlh care costs. It took the Wall Street Journal to uncover the story and the only thing the Roanoke media has done is allow Carilion to spew out propaganda claiming the story is wrong.