Health Care Antitrust
Under the latest federal guidelines (1997), the antitrust concern is high in market that are “highly concentrated” (having a Herfindahl-Hirschman Index (HHI) above 1800), moderate in markets that are “concentrated” (HHI=1000-1800) and “low” in markets where HHI is below 1000 (DOJ/FTC: Section 1.51).
Health Insurance Industry. The McCarran-Ferguson Act, enacted in 1945, gives states the primary responsibility for regulating health insurance and provides that the antitrust laws, including the Sherman Act, the Clayton Act, and the Federal Trade Commission Act, shall apply to the “business of insurance” only to the extent it is not regulated by a state, and shall also apply to boycotts, coercion and intimidation. As interpreted by the courts, the law exempts the business of insurance from government and private antitrust liability, unless the conduct is unregulated by a state or goes beyond otherwise actionable restraints of trade to constitute boycotts, coercion or intimidation (Lerner).
- DOJ/FTC. Horizontal Merger Guidelines. Washington, DC: U.S. Department of Justice and Federal Trade Commission, Issued April 2, 1992; revised April 8, 1997. [Full Text (pdf)]
- Lerner, Arthur. Bill To Repeal McCarran-Ferguson Act Antitrust Exemption For Insurance Business Introduced. Crowell and Moring. [Full Text (html)]
- American Hospital Association. Assessment of Cost Trends and Price Differences for U. S. Hospitals. [Full Text (pdf)]