Health Care Competition Law in the Shadow of State Action: Minimizing MACs

Posted by Social Science Research Network

Health Care Competition Law in the Shadow of State Action: Minimizing MACs

David A. Hyman (University of Illinois) & William E. Kovacic (George Washington University)

Abstract:      How should we go about reconciling competition and consumer protection in health care, given the long shadow cast by the state action doctrine? We consider that issue, using a case study drawn from an obscure corner of the pharmaceutical reimbursement market to motivate and inform our analysis. We show how the balance between competition and consumer protection has been distorted by the political economy of health care regulation –compounded by the extension of the state action doctrine far past its defensible borders. If anything, considerations of political economy argue for much greater skepticism about the utility of regulation – and of the state action doctrine — in the health care space.