FTC Staff: Proposed Health Care Legislation in Alabama Would Likely Foster and Protect Anticompetitive Arrangements That Harm Consumers

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Federal Trade Commission staff submitted written comments opposing proposed legislation in Alabama that purports to immunize “authorities” formed by any public university operating a medical school in Alabama, and their collaborative activities “with all types of health care providers,” from the federal antitrust laws. The comments are in response to a request from Alabama State Senator Larry C. Stutts.

As stated in the comment by staff of the FTC’s Office of Policy Planning and its Bureaus of Competition and Economics, House Bill 241 and Senate Bill 243 seek to immunize potentially anticompetitive conduct from federal antitrust scrutiny. If effective, these bills could shield anticompetitive mergers, price fixing, boycotts, and a wide variety of other anticompetitive conduct that harms consumers. “If enacted, the exemption would not improve patient care, but would likely raise health care costs and decrease access to care,” the comment states.

“ . . . [T]he antitrust laws already permit efficient and pro-consumer mergers,” the comment concludes, noting that such immunity “would prevent antitrust authorities from scrutinizing, moderating, or preventing anticompetitive mergers and conduct that would seriously harm Alabama consumers. In some cases, it could also encourage groups of private health care providers to engage in blatantly anticompetitive conduct.”

The Commission vote to issue the staff comments was 3-0. (FTC File No. V160010; the staff contact is Daniel J. Gilman, Office of Policy Planning, 202-326-3136.)

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