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Healthcare Antitrust Laws

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Sherman Act

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A foundational antitrust law in the United States that prohibits monopolistic behaviors and conspiracies in restraint of trade, which could include price-fixing amongst healthcare providers or insurers.

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Clayton Act

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An antitrust act that addresses specific practices not clearly prohibited by the Sherman Act, such as price discrimination, exclusive dealing contracts, and M&A that may substantially lessen competition or create a monopoly in the healthcare sector.

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Market Share

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The percentage of a market accounted for by a specific entity, with high market share potentially signaling a monopoly power in the healthcare industry, attracting regulatory scrutiny.

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Horizontal Merger

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A merger between two companies that operate at the same level of the supply chain in the same industry, such as two hospitals, which could reduce competition and require government review under antitrust laws.

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Vertical Merger

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A merger between companies that operate at different stages of the supply chain, such as a hospital acquiring a supplier of medical devices, which can raise antitrust concerns regarding control over the healthcare delivery system.

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Tying Arrangement

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A type of anticompetitive practice where a seller requires a buyer to purchase a tied product as a condition of buying a desired product, which can happen in healthcare with bundled medical services or products.

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Robinson-Patman Act

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A federal law that prohibits anticompetitive practices by producers, specifically price discrimination, which can impact healthcare sectors like pharmaceuticals and medical supplies.

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Predatory Pricing

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Selling products or services at a very low price to drive competitors out of the market, which is illegal under antitrust laws and can affect the healthcare sector, particularly in terms of pharmaceuticals or hospital services.

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Hart-Scott-Rodino Act

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This act requires large companies to file a report before completing a merger, acquisition, or tender offer to allow the FTC and Department of Justice to review and potentially block the transaction to avoid reduced healthcare competition.

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Exclusive Dealing

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An agreement where a retailer or wholesaler is ‘tied’ to purchase exclusively from a supplier, preventing competing suppliers from entering the market, which could occur with medical equipment or pharmaceuticals in healthcare.

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Federal Trade Commission Act

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Established the Federal Trade Commission (FTC) to prevent unfair competition methods and unfair or deceptive acts or practices, including in the healthcare marketplace.

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Price Fixing

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An agreement between business competitors to sell the same product or service at a set price, which is illegal under antitrust laws and can occur among healthcare providers or insurers, leading to higher costs for consumers.

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Group Boycott

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A type of anticompetitive behavior where competitors agree not to do business with a specific individual or company, which in healthcare could include excluding certain providers from insurer networks or other collective agreements.

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Certificate of Public Advantage (COPA)

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A legal mechanism that allows states to approve mergers or collaborations usually prohibited under federal antitrust laws if they can show that the benefits to the public outweigh the disadvantages of reduced competition in healthcare.

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Monopsony

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A market condition where there is only one buyer, which in healthcare could mean a single insurer or provider dictates terms to physicians or drug companies, potentially leading to decreased competition and innovation.

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