Health insurer mergers 'potentially dangerous': Mt. Sinai CEO

Mount Sinai CEO: Consolidation potentially dangerous
Mount Sinai CEO: Consolidation potentially dangerous   

Consolidation in the health insurance industry is "potentially dangerous" for the hospital business, the president and CEO of Mount Sinai Health System said Thursday.

Talk of potential takeovers in the sector has heated up recently, with names like Cigna, Aetna and Humana seen as potential targets.

"We'll have fewer people to negotiate with. They'll be able to run our rates down even lower than they are now," Dr. Kenneth Davis said in an interview with CNBC's "Closing Bell."

"This is a low-margin business, particularly for hospitals that take care of urban centers, the socio-economically deprived communities."

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He called it "frightening," and wondered whether the Federal Trade Commission would look into things, depending on what happened.

The bottom line, Davis said, is that health care is too expensive for everybody—for the governments, the employers, employees and insurance companies.

"We've got to find a way to collectively bend the cost curve," he said. "The best way to do that is to begin to move away from what is fee-for service medicine and move to population management."