On July 9, President Biden issued an executive order with the stated intent of promoting competition in the American economy. The order is wide-ranging and addresses agriculture, defense, financial services, information technology, telecommunications, and transportation as well as the health care sector.
The order describes the administration’s view of the importance of a fair, open, and competitive marketplace and the threats posed by excessive market concentration/corporate consolidation — specifically alleging that the lack of competition is driving up prices that consumers must pay for necessities, such as prescription drugs.
The order establishes a White House Competition Council, comprising eight Cabinet-level Secretaries and a few additional members, which will meet semi-annually. This council will coordinate activities of federal agencies to promote competition.
The portions of the executive order pertaining to health care do the following:
- Claim that Americans pay too much for prescription drugs and health care services, and that hospital consolidation has left many areas, particularly rural communities, with inadequate or more expensive health care options. The order affirms the Biden administration policy to enforce the antitrust laws to “combat the excessive concentration of industry, the abuses of market power, and the harmful effects of monopoly and monopsony,” including in the health insurance, hospital, and prescription drug markets.
- Reaffirm the federal government’s authority to challenge transactions whose previous consummation violated federal laws, even if those transactions weren’t challenged previously
- State that the Biden administration supports the enactment of a public health insurance option
- State that the Biden administration supports legislative efforts to lower prescription drug prices, including by allowing Medicare to negotiate drug prices by imposing inflation caps, and through other measures
- Require the Secretary of Health and Human Services to:
- Support existing price transparency initiatives for hospitals, other providers, and insurers, along with any new price transparency initiatives or changes made necessary by the No Surprises Act or other statutes
- Implement standardized options in the national health insurance marketplace to improve competition and help Americans compare insurance plans
- Publish a plan within 45 days to combat excessive pricing of prescription drugs, enhance domestic pharmaceutical supply chains, and reduce drug prices paid by the federal government
- Lower the prices of prescription drugs and biologics and promote generic and biosimilar competition
- Promote low-cost hearing aids
- Encourage the Attorney General and Federal Trade Commission (FTC) to:
- Enforce antitrust laws vigorously, focusing on key markets (including health care)
- Review the horizontal and vertical merger guidelines and the Antitrust Guidance for Human Resource Professionals and revise as appropriate
- Encourage the Food and Drug Administration to work with states and tribes to import prescription drugs from Canada
- Encourage the FTC to use its rulemaking authority to curtail:
- The use of non-compete clauses that may unfairly limit worker mobility
- Unfair anticompetitive restrictions imposed by manufacturers that prevent purchasers/businesses from repairing their own equipment or from paying third parties (rather than the manufacturer) to repair the equipment. Hospitals could potentially save money if they were allowed to repair some of their own equipment.
- Unfair anticompetitive conduct or agreements in the prescription drug industries, such as agreements to delay the market entry of generic drugs or biosimilars (“pay for delay”)
The Biden administration also published a fact sheet explaining the executive order. CHA will monitor the activities of the White House Competition Council as well as actions taken by the Biden administration to implement this executive order and will provide updates through CHA News.