Through a sweeping new executive order, President Joe Biden is taking aim at anti-competitive behavior across the American economy, including in healthcare.
Spanning 72 initiatives, the order signed on Friday aims to tackle competition problems and thereby “lower prices for families, increase wages for workers, and promote innovation and even faster economic growth,” according to a fact sheet released by the White House.
For healthcare in particular, the executive order details four areas where lack of competition increases prices and reduces access to quality care. These include hospitals, health insurance, prescription drugs and hearing aids.
Consolidation among health systems and hospitals is causing an array of problems, especially for rural areas, according to the fact sheet. Research has shown that consolidation drives up prices and has left rural areas without adequate access to care.
The trend has also continued steadily over the past decade, remaining relatively impervious to even the Covid-19 pandemic. Last year, there were 79 transactions involving healthcare mergers and acquisitions, which is within the range of activity seen in the last 10 years.
Through the executive order, Biden urged the Justice Department and Federal Trade Commission to review and revise their merger guidelines through the lens of preventing patient harm. Further, he directed the Department of Health and Human Services to support existing hospital price transparency rules and to finish implementing legislation that bans surprise billing.
With regard to the health insurance industry, consolidation is limiting consumer choice, and when there is a choice, comparison shopping on the Affordable Care Act exchanges is a challenge, the fact sheet states.
Per the executive order, HHS must standardize plan options in the national health insurance marketplace so people can comparison shop more easily.
In addition to providers and payers, consolidation has a huge impact on the prescription drug landscape.
The high prices of prescription drugs in the U.S. are, in part, due to a lack of competition among drug manufacturers, according to the fact sheet. To combat this, Biden has directed the Food and Drug Administration to work with states and tribes to safely import prescription drugs from Canada, bolstering a Trump administration-era rule. The order also mandates that HHS issue a comprehensive plan within 45 days to curb high prices and price gouging.
Similarly, to tackle the issue of prohibitively expensive hearing aids, Biden has directed HHS to consider issuing proposed rules within 120 days that allow hearing aids to be sold over the counter.
“Today’s historic executive order established a whole-of-government effort to promote competition in the American economy,” the fact sheet states. “Once implemented, these initiatives will result in concrete improvements to people’s lives.”
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