FTC, DOJ, and HHS Launch Joint Initiative to Scrutinize Healthcare Industry Consolidation
The Federal Trade Commission (FTC), Department of Justice (DOJ), and Health and Human Services (HHS) have launched a joint initiative to examine the impacts of consolidation in the healthcare industry. On March 5, they issued a Request for Information (RFI) focusing on private equity buyouts, aiming to gather insights from various stakeholders, including patients, payers, providers, and employers.
The RFI seeks public comment on the effects of transactions involving healthcare providers, facilities, or ancillary products/services conducted by private equity funds, health systems, or private payers. The comment period closes on May 6. This move aligns with the White House's December 2023 action plan to lower healthcare costs by promoting competition.
FTC Chair Lena Khan expressed concerns over the 'growing financialization' of the healthcare industry and the impact of 'anticompetitive roll ups' in her remarks at the FTC's March 5 workshop. The RFI is consistent with the FTC's and DOJ's 2023 Merger Guidelines, which target private equity buyers. However, clear examples of private equity funds or alternative asset managers specifically linked to adverse impacts on the health market were not immediately available.
The RFI is an important step in understanding the effects of consolidation in the healthcare industry. The insights gathered from the public comment period will help shape future regulatory actions and ensure that the industry remains competitive and beneficial to all stakeholders.
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