Health Care:

Federal and State Antitrust Actions Concerning the Health Care Industry

HEHS-94-220: Published: Aug 5, 1994. Publicly Released: Aug 24, 1994.

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Pursuant to a congressional request, GAO reviewed: (1) the Department of Justice's (DOJ) and the Federal Trade Commission's (FTC) antitrust enforcement actions against hospitals; and (2) state legislation that creates regulatory programs for the approval of mergers and joint ventures among health care providers.

GAO found that: (1) from fiscal year (FY) 1981 through FY 1993, DOJ and FTC challenged less than 4 percent of the 397 acute care hospital mergers and conducted only preliminary investigations for another 13 percent of these mergers; (2) DOJ and FTC have never challenged a hospital joint venture; (3) in September 1993, DOJ and FTC issued a joint statement on various joint health care activities outlining six circumstances under which they would not challenge the providers' activities; (4) 18 states have enacted regulatory programs for state approval of certain hospital activities which have effectively removed them from federal antitrust jurisdiction; (5) 10 state programs cover other health care providers such as physicians, nursing homes, and ambulatory surgical centers that are licensed to provide health care services; (6) many health association officials believe the state programs are necessary to alleviate the fear of antitrust liability among hospital officials; and (7) the 18 state laws vary considerably in the types of providers and activities covered, state approval authorities, antitrust enforcement officials' role in approving and monitoring activities, the questions and issues to be addressed prior to approval, and the extent of postapproval state supervision.

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