Wednesday, July 22, 2009
Posted by D. Daniel Sokol
Last thursday David Balto, a Senior Fellow at the Center of
American progress testified before the Senate Commerce Committee on
"The Effects of Regulatory neglect on Health Care Consumers."
ABSTRACT: In that testimony he documents the lack of antitrust and consumer protection enforcement in three key areas of health care middlemen: insurance, Pharmacy Benefit Managers (PBMs) and Group Purchasing Organizations. In each, there were no antitrust or consumer protection actions in the past Administration with the result, that the markets have become highly concentrated and plagued with anticompetitive and deceptive conduct. On health insurance in particular, Balto explains that the fundamental elements for a competitive market are transparency and choice and a lack of conflicts of interest. In all of these respects, "health insurance markets are clearly broken. Few markets are as concentrated, opaque and complex, and subject to rampant anticompetitive and deceptive conduct. As the health care debate progresses, many advocate for limited reform of the health insurance system. Their belief is that it is a fundamentally sound market and with a little dose of additional regulatory oversight, all the ills of the market will be cured. They could not be more mistaken." The paper calls for the FTC to realign its enforcement priorities with greater enforcement against health insurers, PBMS and GPOs. http://www.americanprogress.org/issues/2009/07/balto_testimony.html