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White House Gets FTC to Heel

Philip Betbeze, for HealthLeaders Media, October 8, 2010

In case you hadn't noticed, the FTC has gotten quite good at undoing hospital and health system acquisitions that they deem anticompetitive—all while the nation's health insurers have  gained enviable market clout through the same strategy, with little more than light regulatory pressure from the FTC to maintain competitive markets. Perhaps they were looking for the wrong bogeyman.

Insurers compete with each other to a degree, but they compete with hospitals and health systems more acutely. Except in the few cases where a hospital or health system has enough market clout to ensure higher reimbursement per patient, many standalone and small hospital systems are  unable to break even under that reimbursement scheme.

In any case, the story, in which the FTC promised to waive certain antitrust laws if they hindered the creation of effective ACOs, was welcome news for hospital and health system leaders who are trying to figure out what services and employees to cobble together to form ACOs. Much of the reform legislation becomes real in 2014, but hospitals and health systems need as much lead time as possible to try to innovate through a maze of conflicting government regulatory relationships and federal turf battles. This is just one glaring example of many more that undoubtedly fly under the radar.

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2 comments on "White House Gets FTC to Heel"


bob (10/11/2010 at 10:53 AM)
The simple solution is to pass legislation exempting the not-for-profits from per se anti-trust violations. Possibly, the administration is able to do that without legislation? That could make a real difference. There should be no legal restrictions on collaboration purely in the public interest.

Patrick Plemmons (10/8/2010 at 11:10 PM)
"The admirable goals of healthcare reform". Really? Do you really think the "White House" is bringing the FTC to heel? The goals of this White House with regard to "healthcare reform" are to undermine the private market for healthcare to the extent that a single payer, government run system is inevitable. Every day brings new evidence of this to anyone who cares to look and think. It is touching that you ascribe such noble motives to the "White House" but unless this awful piece of legislation is rolled back, the hospital industry in this country is going to be a wholly-owned subsidiary of the Federal government and will not have to worry about accountable care organizations or anything else other than taking orders. Let's see what November 2 brings. It can't come soon enough.