THE SOURCE BLOG

The high-profile antitrust case against Sutter Health settled on the eve of trial in October 2019, when the Northern California hospital giant reached a preliminary settlement agreement with the California Attorney General’s office and class action plaintiffs after five years of litigation. The terms of the settlement were released late December, which include both monetary compensation for the private plaintiffs and injunctions against Sutter’s conduct that will restore competition and promote transparency in the provider market. In this post, we dissect the terms of the proposed settlement agreement and discuss …

On January 10, the Department of Justice (DOJ), along with the Federal Trade Commission (FTC), released a new draft guideline for vertical merger review. As opposed to horizontal mergers, vertical mergers generally combine entities that operate at different levels in the same supply chain. As vertical mergers become more commonplace in the healthcare industry, they are increasingly raising antitrust concerns as they often times don’t trigger the same level of scrutiny as do horizontal mergers. The much needed new guidelines specifically targeting vertical mergers serve to withdraw and update the …

On January 10, California Governor Gavin Newsom released his 2020-2021 State Budget proposal. While the state budget process will not begin in earnest until after the Governor’s May Revise, the state budget provides a glimpse of likely California health care reforms. The Governor’s January Budget Proposal proposes the following: Proposal Goals Office of Health Care Affordability Increase price and quality transparency Develop cost targets for health care industry Address hospital cost trends by region, with focus on cost increases driven by delivery system consolidation Establish standards for advance evidence-based and …

Happy New Year! We hope you had an exciting start to the new decade! In this edition of the Source Roundup, we cover articles and reports from December that discuss: (1) increase in US health care spending in 2018, (2) health system affiliation and how it affects patient access, (3) out-of-network provider charges between 2012 and 2017, and (4) how billing in-network could save millions.   U.S. Health Care Spending Increased 4.6 Percent to Reach $3.6 Trillion in 2018 In the Health Affairs article National Health Care Spending in 2018: …

Today, California Attorney General Xavier Becerra announced the settlement terms for the landmark antitrust case, UFCW & Employers Benefit Trust v. Sutter Health. Sutter Health was alleged to engage in anticompetitive behavior by requiring “all or nothing” contracts, preventing insurance companies from providing tiered health plans, setting extremely high out-of-network rates, and restricting price transparency of provider cost information and rates. As Source Executive Editor Jaime King explains in a Tradeoffs episode, The Train Has Left the Station, “[t]his is a huge case. Sutter is a huge entity in Northern …

Price transparency in healthcare is a hot topic that has captured the attention of many policymakers. While both federal and state governments have made efforts to promote price transparency in recent years, the path to achieving it is expected to be a bumpy one, as powerful industry groups that resist such change, including hospitals and pharmaceutical companies, are quick to seek legal challenges to block such efforts. In this edition of Litigation and Enforcement Highlights, we examine the latest lawsuits that challenge legislation to promote price transparency in healthcare and …

On Thursday, December 12, 2019, the House passed H.R. 3, the Elijah Cummings Lower Drug Costs Now Act, with unanimous support of House Democrats, but only 2 Republican votes. While the primary provisions of the bill and the conclusions drawn in our original blog post remain unchanged, we highlight two changes made to the bill as described in our post before it was passed. First, the original bill required drug manufacturers that increase the price of a drug faster than the rate of inflation (benchmarked to prices in 2016) to …

*See 12/13/19 Update: House Passes the Elijah Cummings Lower Drug Costs Now Act (H.R. 3)   Increasing the affordability of prescription drugs is of primary importance to Congress and to the nation. In this post, we review two of the federal bills receiving substantial press coverage – the Lower Drug Costs Now Act, introduced in the House by Speaker Pelosi and the Prescription Drug Pricing Reduction Act, introduced in the Senate by Senator Grassley. While the current bills may have a bumpy road to approval, we analyze the proposals in …

The Source on Healthcare Price and Competition is excited to announce that, in partnership with UC Berkeley’s Nicholas C. Petris Center on Health Care Markets and Consumer Welfare, we are unveiling a brand new interactive “Market Consolidation” key issue page that presents evidence-based information and analyses on the most effective strategies for states to address rapidly consolidating healthcare markets. Recent evidence demonstrates that provider and insurer markets in the United States have been highly concentrated for years and have led to increased healthcare prices and insurance premiums without a commensurate …

Happy December! The holiday season is upon us and it is time to cozy up with a warm cup of tea to the latest health policy news.  This edition of the Source Roundup looks at articles on 1) healthcare market consolidation and provider network access, 2) increases in insurance premium contributions and deductibles, and 3) lessons from healthcare system reforms abroad.   Healthcare Markets Accountable care organizations (ACOs) have been lauded for providing higher quality medical care at lower costs.  In a recent Health Affairs research article, Changes in Physician Consolidation …