Health Care and Life Sciences > Health Reform Resource Center > FTC Chairman Announces Public Workshop on Payment Reform and Competition Policy
18 Jun '10

In a speech to the American Medical Association (AMA) on June 14, Jon Leibowitz, chairman of the Federal Trade Commission (FTC), reiterated the FTC’s enforcement position on clinical integration and emphasized the Commission’s willingness to offer guidance on proposed collaborations.  He also noted that the health care reform law contains provisions intended to promote innovative payment structures, including Medicare pilot programs for accountable care organizations (ACOs).  Chairman Leibowitz said that “so long as the government purchases the services and unilaterally sets payment levels and terms, there won’t be an antitrust issue [with ACOs].”   However, he also observed that ACOs may move into the private sector and create competition issues.  Although he did not elaborate, a potential area for concern is the possibility that the level of integration necessary to become an ACO will not be as great as the level of integration required under current federal antitrust policy to allow providers to negotiate collectively with health plans.  Another possibility is that the size of ACOs either required by HHS or prompted by HHS’s rules is so great that the ACOs will aggregate market power in violation of the antitrust laws.  Given that ACOs are, as Chairman Leibowitz said, “in the very early stages of formation and evaluation,” it is too early to predict whether these concerns will be borne out.  Nevertheless, recognizing the potential impacts on competition of payment reform provisions of the healthcare reform law, Chairman Leibowitz announced that in the fall, the FTC will hold a public workshop on “competition policy, payment reform, and the new models for delivering high-quality, cost-effective health care.”  He stated that the Commission “will focus on how ACOs could affect competition among commercial payers and provide consumers with access to affordable health care services.”