FTC Approves Filing of Staff Comments Regarding Proposed Regulation of Retail Health Care Facilities in Illinois

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Commission approval of filing of staff comments – The Commission has approved the filing of comments by the staff of the Office of Policy Planning and the Bureaus of Economics, Competition, and Consumer Protection with State Representative Elaine Nekritz, of the Illinois House of Representatives, regarding Illinois House Bill 5372 (HB 5372) and the proposed regulation of retail health care facilities (retail clinics) within the state. The comments address Rep. Nekritz’s general concerns about provisions in the bill that could be considered anticompetitive and her specific concerns over the bill’s prohibition on the location of a retail clinic “in any store or place that provides alcohol or tobacco products for sale to the public.”

According to the comments, although Illinois’ initiative to provide for the emergence of this new model of health care delivery is to be encouraged, “[s]everal of HB 5372's provisions could harm health care competition – and the emergence of new clinics – without providing countervailing benefits for Illinois health care consumers.”

Staff questioned, for example, a “nondiscrimination” provision that might be read to restrict the ability of third-party payers to negotiate favorable terms with retail clinics and to pass certain savings on to health care consumers via reduced copayments. In addition, staff raised concerns about several advertising provisions in the bill that “may unduly restrict consumer access to truthful and non-misleading information about basic health care services.”

As to HB 5372's tobacco and alcohol sales restrictions, FTC staff recognized the state’s interest in safeguarding the health and welfare of its citizens and that such interests may prompt regulatory restrictions that guard against, for example, the sale of alcohol and tobacco products to minors. However, the rationale for not allowing a clinic in a retail store that also sells tobacco or alcohol is unclear. At the same time, this restriction could limit the supply of retail clinics and the basic medical services they would provide if retail stores were to decide sales of tobacco and alcohol were more profitable than having a retail health clinic.

Staff concludes the letter by suggesting that the Illinois Legislature consider clarifying those provisions in HB 5372 that may be subject to interpretations that would limit health care competition. The Legislature should ensure that retail clinics are not at a competitive disadvantage to other providers of similar services.

The FTC vote approving the filing of the staff comments was 4-0. Copies of the comments can be found as a link to this press release on the Commission’s Web site. (FTC File No. V080013; the staff contact is Daniel J. Gilman, Office of Policy Planning, 202-326-3136.)

Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FYI 26.2008.wpd)

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