Competition Corner

Health care companies and stakeholders should be prepared for an uptick in antitrust complaints and investigations in the short term, driven by the launch of HealthyCompetition.gov. Despite the anticipated short-term impact, the long-term impact remains uncertain and depends on the sustained engagement and use of the tipline by the public.

In the latest step in the U.S. antitrust agencies’ heightened enforcement against private equity, the Federal Trade Commission held a Workshop on Private Equity in Health Care yesterday with the U.S. Department of Justice and Department of Health and Human Services.

On September 27, 2023, a Louisiana federal court issued a landmark ruling addressing the intersection of the Hart-Scott-Rodino (HSR) Act and the Certificate of Public Advantage (COPA) regimes adopted by various states.

The Federal Trade Commission’s (FTC) continued scrutiny of private equity “roll-up” strategies resurfaced in a recent complaint filed in Texas federal court alleging that the private equity firm Welsh, Carson, Anderson & Stowe (Welsh Carson) and its portfolio company U.S. Anesthesia Partners, Inc. (USAP) entered into a “multi-year anticompetitive scheme to consolidate anesthesiology practices in Texas, drive up the price of anesthesia services provided to Texas patients, and boost their own profits.” 

Illinois has adopted a new antitrust law, effective January 1, 2024, requiring pre-merger notification of certain transactions between health care entities, including hospitals and provider groups. 

The Department of Justice’s Antitrust Division announced on Friday, February 3, that it is withdrawing three longstanding policy statements providing guidance concerning its enforcement of the antitrust laws in the health care industry, a move that leaves significant uncertainty in its stead.  Although focused on health care, the policy statements have long been relied upon as important guidance for competitor collaborations in other industries, particularly regarding sharing price- or cost-related information and joint purchasing.

While regulators are signaling their goals to revise and strengthen merger enforcement, they are picking a fight against a particular obstacle to achieving their vision in health care. Specifically, the Federal Trade Commission is currently pushing states to restrict their use of Certificates of Public Advantage. 

The U.S. Federal Trade Commission (FTC) and Department of Justice, Antitrust Division (DOJ) recently hosted a two-day virtual workshop titled “The Future of Pharmaceuticals: Examining the Analysis of Pharmaceutical Mergers.”

On June 2, 2022, the Federal Trade Commission (“FTC”) continued its aggressive scrutiny of health system mergers, announcing administrative challenges to two proposed mergers – one in Utah, and the other in New Jersey. The Utah challenge seeks to block the proposed merger between HCA Healthcare and Steward Health Care System in the Wasatch Front region of Utah, which surrounds Salt Lake City. The New Jersey challenge is aiming to prevent RWJBarnabas Health’s proposed acquisition of Saint Peter’s Healthcare System in Middlesex County, New Jersey. The FTC is also pursuing injunctive relief in federal court in both cases. The FTC voted unanimously to challenge both mergers.

In a recent speech, the Deputy Assistant Attorney General (DAAG) at the Department of Justice (DOJ) Antitrust Division stated that DOJ intends to closely examine certain private equity transactions; in particular, those in the health care industry. This speech continues a trend of public statements by top antitrust officials emphasizing enhanced antitrust scrutiny of private equity transactions.

A putative class of Connecticut citizens is alleging that Hartford HealthCare has amassed monopoly power to “extract higher prices from insurers, employers, and patients.” The suit, filed in Connecticut state court, alleges Hartford HealthCare has illegally monopolized the markets for inpatient hospital services and outpatient medical services in multiple geographic locations throughout Connecticut.

What impacts will the sweeping Executive Order on Promoting Competition have on companies? In this episode of Winston & Strawn’s Competition Corner Podcast, Attorneys Molly Donovan, David Dahlquist, Susannah Torpey, and Kevin Goldstein discuss the Order’s directives and recommendations targeting labor markets, the tech sector, and the healthcare and life sciences industries.

On July 9, 2021, President Biden issued the “Executive Order on Promoting Competition in the American Economy” (the Order) and the White House’s contemporaneous Fact Sheet with the intent to promote economic competition, rigorously enforce existing antitrust laws, and update regulations to combat practices not prohibited by existing antitrust law that may be used to anticompetitive ends. The Executive Order continues recent years’ bipartisan focus on the healthcare industry, a rare area in which Democrats and Republicans have sought common ground to bring down costs.

On May 19, 2021, the U.S. Senate Subcommittee on Competition Policy, Antitrust, and Consumer Rights convened a hearing to discuss hospital consolidation.

On April 29, 2021, the U.S. House of Representatives Subcommittee on Antitrust, Commercial, and Administrative Law met to discuss consolidation in health care markets.

On March 16, 2021, acting Federal Trade Commission (FTC) Chairperson Rebecca Slaughter announced the formation of an international working group that will seek “to identify concrete and actionable steps to review and update the analysis of pharmaceutical mergers,” specifically ensuring that the FTC and other regulatory bodies will utilize fresh approaches and “fully analyze the varied competitive concerns” that pharmaceutical mergers raise.

On December 22, 2020, Congress passed the Competitive Health Insurance Reform Act (CHIRA), H.R. 1418, which will amend the McCarran-Ferguson Act to apply the federal antitrust laws to the health insurance industry. President Trump signed the bill into law on January 13, 2021.

While much of the impact of the new administration is still up in the air pending President-Elect Biden’s appointments of key personnel and the results of the Senate run-offs in Georgia, we are likely to see changes to the focus of the Department of Justice and Federal Trade Commission, and increased antitrust enforcement in several key industries, including tech, health care, and agriculture, over the next several years. 

Recognizing that the fight against the COVID-19 pandemic will “require unprecedented cooperation,” the U.S. Federal Trade Commission (FTC) and Department of Justice (DOJ) Antitrust Division (collectively, “the agencies”) provided new antitrust guidance and announced an expedited seven-day advisory opinion procedure for business collaborations responding to the coronavirus crisis, in a joint statement issued on March 24, 2020.

The Federal Trade Commission (FTC) is continuing its aggressive scrutiny of health system mergers with its February 27, 2020 filing of an administrative complaint seeking to block the proposed merger of Pennsylvania-based Jefferson Health (Jefferson) and Albert Einstein Healthcare Network (Einstein).