American Economic Review: Insights
ISSN 2640-205X (Print) | ISSN 2640-2068 (Online)
Is There Too Little Antitrust Enforcement in the US Hospital Sector?
American Economic Review: Insights
vol. 6,
no. 4, December 2024
(pp. 526–42)
Abstract
From 2002 to 2020, there were over 1,000 mergers of US hospitals. During this period, the FTC took enforcement actions against 13 transactions. However, using the FTC's standard screening tools, we find that 20 percent of these mergers could have been predicted to meaningfully lessen competition. We show that, from 2010 to 2015, predictably anticompetitive mergers resulted in price increases over 5 percent. We estimate that approximately half of predictably anticompetitive mergers had to be reported to the FTC per the Hart–Scott–Rodino Act. We conclude that there appears to be underenforcement of antitrust laws in the hospital sector.Citation
Brot, Zarek, Zack Cooper, Stuart V. Craig, and Lev Klarnet. 2024. "Is There Too Little Antitrust Enforcement in the US Hospital Sector?" American Economic Review: Insights, 6 (4): 526–42. DOI: 10.1257/aeri.20230340Additional Materials
JEL Classification
- G34 Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
- G38 Corporate Finance and Governance: Government Policy and Regulation
- I11 Analysis of Health Care Markets
- K21 Antitrust Law