Biden takes aim at 'price gouging' in health care: HHS, FTC, DOJ will partner up
The three major agencies are adding new health care counsels to scrutinize what the White House calls “corporate greed” in health care, such as firms “rolling up” small practices in transactions that don’t meet antitrust thresholds.
Satisfaction with almost every major aspect of the U.S. health care system has dropped since 2010, a Gallup poll released this week found. The Biden administration has announced several initiatives to address both the quality and cost of care.
“For too long, corporate special interests and trickle-down economics have allowed big pharma to make record profits, while millions of Americans struggle to afford health care and prescription drugs to treat common and chronic conditions,” the White House said in a fact sheet. “As part of the President’s Bidenomics agenda, the Biden-Harris administration is cracking down on price gouging and taking on special interests to lower costs for consumers and ensure every American has access to high-quality, affordable health care.”
The broad-based actions that were announced include plans to reduce prescription drug costs; scrutinize anticompetitive acquisitions and practices; and build on past actions to increase health-care competition and lower prescription drug costs.
“Anticompetitive acquisitions and practices can chill fair competition, leading to higher health-care costs, degraded working conditions and less innovation across the health care and pharmaceutical industries,” according to the administration. “Through regulatory and legal actions, the Federal Trade Commission, Department of Justice and Department of Health and Human Services are each working to promote competition to lower health care costs for families and taxpayers and improve the quality and availability of health care for patients.”
The three agencies are partnering on new initiatives that include a joint request for information to seek input on how private-equity and other corporations’ control of health care is affecting Americans. In addition, HHS will appoint a chief competition officer, and the Justice Department’s Antitrust Division and the FTC each will name counsels for health care to lead these efforts.
Antitrust experts who spoke with the news website STAT agreed that the three new roles likely will formalize informal communications already going on between the FTC and the Justice Department, which share the duties of scrutinizing health sector mergers and acquisitions. Generally speaking, the Justice Department has focused on health insurance company activities, while the FTC has focused on providers, such as hospitals and physician practices. However, these lines increasingly are becoming blurred, making communication and coordination more crucial, said John Carroll, a partner at the law firm Sheppard Mullin.
“You have transactions that are payer-provider, you have transactions that are payer-provider-pharmacy, you have [management services organizations], you have all these different entities and businesses providing care or providing some form of insurance or managing that care across the U.S. health care ecosystem,” he said.
Related: Biden’s pharma fix: New ‘march-in’ rule allows HHS to seize patents of pricey drugs
Rick Zall, partner and chair of health-care transactional and regulatory practice at King & Spalding, said agencies are moving from a reactive to a proactive position, which he hopes allows them to provide more guidance and take new initiative for regulations.
Each of the three agencies shared recent actions they said will spur competition.
- The FTC touted several recent policy changes and lawsuits that aim to help consumers. “Decades of corporate consolidation have contributed to soaring costs across health care markets, with Americans now paying more for everything from lifesaving medicines to a hospital visit,” FTC Chair Lina M. Khan said. “Safeguarding fair competition and rooting out unlawful business practices in health care markets is a top priority for the FTC. We will continue to fire on all cylinders to protect patients, health care workers and competition in these critical markets.”
- The Justice Department is reinvigorating antitrust enforcement to safeguard competition in health care markets and advocating to strengthen labor market competition for health care workers. “Protecting and promoting competition in health care markets is among the division’s top priorities,” said Jonathan Kanter, assistant attorney general in the antitrust division. “Absent competition, real people suffer real harms. Those harms are especially grave when we’re talking about the medical care people depend on to live their lives. We are committed to weeding out anticompetitive practices and market consolidation that hinder Americans’ access to quality care at affordable rates or deprive health care workers of fair wages and opportunity.”
- Priorities at HHS include cracking down on anticompetitive practices in Medicare Advantage; negotiating and lowering drug prices; and making hospital charges more transparent. “Competition in the marketplace lowers costs and spurs innovation,” Secretary Xavier Becerra said. “The Biden-Harris Administration remains laser-focused on increasing access to high-quality, affordable health care for all Americans, like by making hearing aids available for sale over-the-counter and lowering prescription drug costs through the Inflation Reduction Act.”