The U.S. Department of Justice (DOJ) and Federal Trade Commission (FTC) have done almost nothing over the past decades to protect market competitiveness and consumer interests in healthcare. Employers continue to grapple with ever-rising plan costs as members bear the brunt of fewer healthcare options at a higher cost.
The DOJ and FTC have allowed massive and ongoing acquisitions and mergers by (and sometimes between) hospitals and health systems, pharmacy benefit managers, pharmacies, and insurance carriers to go unchecked. This has fostered monopolies and cartels in these sectors, reducing competition and increasing prices for medical services, drugs, and health insurance.
Consider the following:
- The top three PBMs capture nearly 85% of the market
- The top four insurance carriers own over 40% market share
- The nation’s top four health systems command over 50% of market share and revenue
This continued inaction by agencies responsible for protecting society from anti-competitive practices is even more appalling now that the FTC declined to probe the predatory practices of the PBM industry after a tie vote along political party lines.
Employers and health benefits advisors should not hang their hopes on government protections or interventions to create free market results in healthcare. Thankfully, solutions are available right now to help employer health plan sponsors and forward-thinking advisors escape the racketeering that the DOJ and FTC seem unwilling to address.