The U.S. Government Accountability Office (GAO) issued a report on April 16 assessing the adequacy of antitrust guidance for collaborations among competing healthcare providers. The GAO asked three types of stakeholders -- healthcare industry groups, antitrust law experts and the antitrust enforcement agencies -- to evaluate the adequacy of antitrust guidance in three areas: clinical integration, exclusive arrangements and the size and scope of antitrust safety zones. The results reflected the uncertainties regarding the application of antitrust rules in the changing healthcare marketplace. The industry groups were unsatisfied with the available guidance; the antitrust experts generally regarded the guidance as sufficient but with room for improvement; and the enforcement agencies -- the Antitrust Division of the Justice Department and the Federal Trade Commission (FTC) -- thought that their guidance was just right.
Antitrust guidance for collaborations among competing healthcare providers comes from a patchwork of sources. Those include the 16-year-old joint FTC/Justice Department Statements of Antitrust Enforcement Policy in Health Care, the more recent FTC/Justice Department enforcement policy statement for accountable care organizations, and the FTC advisory opinions and Justice Department business review letters that the agencies issue in response to specific requests. Litigated cases are of limited help. The enforcement agencies sue most often in extreme cases, where competing providers enter into arrangements with little regard for antitrust compliance.
The first area GAO evaluated was clinical integration. Clinical integration among competing providers is thought to contribute to procompetitive efficiencies. Only one of the four industry groups thought antitrust guidance on clinical integration was sufficient. Five of the six antitrust experts found the degree of guidance adequate, while the agency officials contended that their guidance in the area is sufficient. The second area was whether the agencies should permit greater use of exclusive collaborative arrangements among competing providers. Exclusive arrangements often are regarded as having a greater potential to reduce competition unduly. Three of the four industry groups thought that the agencies should be more hospitable to exclusive arrangements. In contrast, four of the six experts thought that the agencies' position on exclusive arrangements was reasonable. The agencies took the position that current guidance gives providers sufficient flexibility to use exclusive arrangements and that numerous collaborative arrangements do so.
Finally, only one of the four industry groups and only one of the six antitrust experts thought that the size and scope of the safety zones laid out in the 1996 enforcement policy statements were appropriate. The agency officials stressed that arrangements outside the safety zones are not presumptively unlawful and expressed reluctance to expand those safety zones.
Certainty and predictability in structuring business arrangements are crucial, but the healthcare industry depends for guidance on enforcement agencies that function as prosecutors, not rule makers. The GAO report reflects this fundamental disconnect. Healthcare providers have to make the porridge as best they can, but the enforcement agencies won't tell the industry whether it's too cold, too hot or just right until they taste it.