Markets Wired

Federal Trade Commission staff has submitted comments to New York Senator Michael H. Ranzenhofer and New York Assemblyman Thomas Abinanti regarding the possible effects of a legislative proposal on competition for health care services.

The comment, submitted by staff of the FTC’s Office of Policy Planning, Bureau of Competition, Bureau of Economics, and Northeast Regional Office, concerns New York Senate Bill 2647 and New York Assembly Bill 2888, which would authorize Erie County Medical Center Corporation and Westchester County Health Care Corporation to collaborate with other public and private health care providers and payers. The proposed legislation would provide them and their collaborating entities with broad immunity from liability under federal and state antitrust laws – even though this purported immunity would cover the kinds of information sharing and joint contract negotiation that are likely to result in reduced competition and higher prices for consumers.

“Because procompetitive or competitively benign health care collaborations already are permissible under the antitrust laws, the main effect of this legislation is to immunize conduct that would not generate efficiencies that are greater than consumer harms, and therefore would not pass muster under the antitrust laws,” the staff comment stated.

The comment concluded, “FTC staff urges the New York State Senate and Assembly to carefully consider whether antitrust immunity – especially the broad immunity these bills purport to grant – would further legitimate public policy goals or, instead, result in higher prices for consumers without any offsetting improvements to health care quality and access.”

The New York Attorney General’s office also submitted a letter opposing the proposed legislation.

The Commission vote approving the comment was 5-0. (FTC File No. V150005; the staff contact is Stephanie A. Wilkinson, Office of Policy Planning, 202-326-2084.)