Biden administration announces effort to make healthcare more competitive and transparent

Providers and insurers should be on the lookout for the Biden administration to hand down regulations and guidance intended to promote competition in healthcare.

The White House in December released a fact sheet stating its position that a lack of competition affects healthcare prices and accessibility for consumers.

Drug costs have been a target of the administration’s efforts, including through the Inflation Reduction Act, the sprawling 2022 law that gave Medicare the authority to negotiate drug prices, among other relevant provisions. The fact sheet explains that newly proposed guidance from the U.S. Department of Commerce would establish price as a determining factor in whether a new drug can be licensed to another manufacturer to ensure the drug is accessible.

Concerns over PE ownership

HHS, the Federal Trade Commission (FTC) and the U.S. Department of Justice (DOJ) will issue a request for information (RFI) on the impact of private equity (PE) ownership of healthcare facilities.

Findings will be used to “identify areas for future regulation and enforcement prioritization,” and the agencies pledge to continue collaborating on “case referrals, reciprocal training programs, data sharing and further development of additional healthcare competition policy initiatives,” the fact sheet states.

In addition, HHS is establishing the position of chief competition officer, while FTC and DOJ both are incorporating the role of healthcare counsel.

Existing regulations that require ownership transparency with respect to hospitals, skilled nursing facilities, hospice providers and home health agencies are being expanded to include federally qualified health centers and rural health clinics.

“Making ownership information transparent allows for identification of common owners with histories of poor performance, analysis of trends on how market consolidation impacts consumers, and evaluation of the relationships between ownership and changes in healthcare costs and outcomes,” the fact sheet states.

The agencies also intend to place new emphasis on regulating clusters of small acquisitions that ultimately allow a buyer to consolidate a given market even though each individual acquisition does not meet the threshold for antitrust scrutiny. Stepped-up data sharing will be deployed to help identify “potentially anticompetitive transactions that might otherwise evade ready review by antitrust enforcers,” according to the fact sheet.

Constraints on MA plans

Medicare Advantage (MA) health plans face the prospect of increased oversight, stemming in part from a previously proposed rule for 2025 that would implement restrictions on plans’ marketing and communication practices and on compensation for plan agents and brokers.

In that rule, CMS also proposed tweaks to the agency’s process for applying risk adjustment data validation to MA payments as a means to track overpayments.

“CMS will continue to implement updates to Medicare Advantage payment that improve payment accuracy, address gaming and recover overpayments,” the White House fact sheet states. “Addressing overpayment in Medicare Advantage will help to make the market more competitive between Medicare Advantage plans and create a more level playing field between Medicare Advantage and Traditional Medicare.”

Looking to boost MA data collection

CMS also is seeking comment from healthcare stakeholders about the MA program after feedback previously suggested the need for greater transparency.

In a new RFI, with comments due May 29, CMS hopes to gain insight on how data should be gathered in aspects of MA such as provider directories and networks, prior authorization and utilization management, and various other areas.

“Our eventual goal is to have, and make publicly available, MA data commensurate with data available for Traditional Medicare to advance transparency across the Medicare program, and to allow for analysis in the context of other health programs like accountable care organizations, the [Affordable Care Act insurance] marketplace, Medicaid managed care [and] integrated delivery systems, among others,” CMS states in the RFI.