Significant Federal Changes to Healthcare Regulation Loom

The Biden Administration has been extremely busy this summer, with the development of new initiatives designed to reform the healthcare system in the U.S. The focus has been on so-called “junk fees” hidden in almost every sector of the economy, as well as lowering healthcare costs for Americans. And three recent actions in particular have emphasized just how important this is to the Administration – even in the face of criticism and legal action.

The Federal Trade Commission (FTC) recently withdrew two policy statements that deal with competition in healthcare. They were originally published in 1996 and 2011, but the agency stated that given how much things have changed since then, they are “outdated and no longer reflect market realities.

And while policy statements are non-binding and don’t set any legal requirements, the FTC did state that it believes removing these two statements will significantly help promote fair competition in healthcare. 

But that doesn’t mean that the FTC is exiting stage left from antitrust enforcement. It will just now look at mergers and conduct reviews on a case-by-case basis. 

Not everyone is pleased by this move, however, with the American Hospital Association (AHA) citing their disappointment that the agency withdrew, rather than modernized, the written guidelines – and did not have a conversation with stakeholders in the field about doing so. 

The Consumer Financial Protection Bureau (or CFPB), U.S. Department of Health and Human Services (HHS), and the U.S. Department of the Treasury recently announced a joint request for information (RFI) on medical credit cards and installment loans proposed to patients as a way to cover their medical costs. 

The agencies hope to obtain commentary on how common these medical credit cards and loans are, what the interest and fees are, patient experiences, and whether they felt that the cards and loans were pushed on them – and if providers are in any way incentivized to offer them (and if so, what types of incentives are offered). They are also hoping to gain information on if these types of medical credit cards and loans for patients are actually making existing healthcare billing and collections issues worse. 

The CFPB additionally recently held a hearing on the issue, wherein examples were provided of times in which a consumer felt pressured or uninformed about the patient financing option they selected. The agencies hope that together, they’ll be able to better understand the overall market, as well as how their individual agencies might need to respond through regulation.

The Administration also recently announced new data on how effective the Inflation Reduction Act is expected to be at reducing costs of pharmaceuticals, highlighting an estimated $400 per year savings for Medicare beneficiaries. Just last week, the White House brought in leaders of in retail health to help spread the word about the law and its potential cost savings to the retail chains’ customers: CVS Health, Walgreens, and Walmart stopped by to discuss how to best educate customers about who can benefit and how much, as well as how best to convey that information, whether it be through social media or printing it on customer receipts. 

This meeting was held amid the filing of several lawsuits against the Administration on this initiative, however. Multiple pharmaceutical companies and groups have sued over the provision of the Act that allows Medicare to negotiate prices for certain drugs, arguing that the measure is unconstitutional. 

It will prove to be a busy next few months for both the Administration and for the industry. But I’ll leave you with these remarks from HHS Secretary Becerra – when asked about some of the challenges the Administration is facing in implementing its initiatives, he stated it “won’t be deterred” and “isn’t letting anything get in our way” when it comes to lowering healthcare costs.