Policy Examples

  • By October 2019, the Centene acquisition of WellCare had been approved by a total of 24 states. Both companies expect the transaction to be completed by the first half of 2020. source
  • The California Department of Justice rejected a proposed merger between Adventist Health System/West and St. Joseph Health System. The state said it was concerned that the transaction was not in the public interest and could increase health care costs while limiting access and availability of health care services. source & source
  • The Department of Justice played a role in blocking horizontal mergers across healthcare entities that provide the same services, such as Aetna and Humana, two health insurers. However, the DOJ has approved vertical mergers of entities that work complementary to one another, such as CVS, a pharmacy, and Aetna, an insurer. source & source

Outcome Evidence

  • Manatt identified the following five healthcare antitrust trends for 2019: more vertical deals, limited or no behavioral remedies, an increasingly prominent role of state regulators in healthcare transactions, focus on restrictive agreements, and more no-poach cases. source
  • The current wave of mergers and acquisitions of physician practices across the country has left many markets with a dominant hospital. source
  • In 2016 NEJM conducted a study reviewing the number of hospital mergers that are contested by the DOJ. Between 2014 and 2015 of the 202 mergers, only 7 were thought by the Department to have violated competition laws. source
  • The hospital market structure is strongly associated with price levels and contract structure. Prices at monopolized hospitals are 12% higher than those in markets with four or more rivals. Upon examination of the 366 mergers and acquisitions that occurred between 2007 and 2011, prices increased by over 6% when the merging hospitals were geographically close (e.g., 5 miles or less apart), but not when the hospitals were geographically distant (e.g., over 25 miles apart). source

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