Markets Wired

Federal Trade Commission staff has issued a public notice encouraging academic and industry research on the impact of certificates of public advantage (COPA) on prices, quality, access, and innovation for healthcare services. The notice also seeks public comments regarding the benefits or harms that have resulted from COPAs or other state-based regulatory approaches intended to control healthcare prices and improve quality.

Staff of the FTC’s Office of Policy Planning, Bureau of Economics, and Bureau of Competition seek this information to enhance their understanding of COPAs, and anticipate hosting a public workshop on this topic in the fall of 2018.

Since the 1990s, several states have passed COPA laws and regulations intended to permit healthcare providers to enter into cooperative agreements that might otherwise be subject to antitrust scrutiny. The goal of such COPA laws generally is to reduce “unnecessary” duplication of healthcare resources and control healthcare costs. In recent years, providers have claimed that these cooperative agreements would provide efficiencies to enable them to participate in new healthcare delivery and payment models. COPA laws vary by state, but generally purport to immunize mergers and other conduct from antitrust laws if the state determines that the likely benefits of the COPA outweigh any disadvantages attributable to reduced competition.

While affirming that the antitrust laws do not stand in the way of beneficial collaboration among healthcare providers, FTC staff has issued several advocacy comments raising concerns about whether COPA regulations actually achieve the states’ intended policy goals, and in some instances has recommended the denial of COPA applications. FTC staff is not aware of any empirical evidence demonstrating that COPA statutes and regulations produce better results for consumers than market-based competition, but recognizes that more empirical work on the impact of COPAs could provide benefits to policymakers considering these important issues.

FTC staff’s public notice is intended to facilitate discussion about ways to study COPAs, and to encourage empirical research that can inform future policy development. FTC staff invites public comment from healthcare providers, payers, consumers, state officials, policy experts, academics, economists, and other interested parties. Suggested topics for comment and instructions for filing public comments are included in the notice.

(FTC COPA Assessment, Project No. P181200; the staff contact is Stephanie Wilkinson, Office of Policy Planning, 202-326-2084)

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