It sounds that way if you're a short-sighted conservative type or a hospital union rep, and makes sense until you realize that there is a glut of hospital beds in most places in the US. Care is shifting from institutions to outpatient environments, and has been for 40 years.

That excess capacity tends to be filled up with old and poor people on government health programs, and people needlessly hospitalized are likely to get more sick as a direct result of their unnecessary hospitalizations.