On October 21, 2019, the Federal Trade Commission (FTC) announced that it had issued orders to five health insurance companies and two health systems to provide information that will allow the agency to study the effects of certificates of public advantage (COPAs) on price, quality, access, and innovation of healthcare services. The ultimate goal of the study is to enhance the FTC’s knowledge of COPAs in order to inform the agency’s advocacy and enforcement efforts, and to serve as a resource for states considering COPAs.
A COPA is a written certificate typically issued by a state department of health under state law and regulations that seek to displace federal (and sometimes state) antitrust laws, and thereby provide immunity from antitrust law to certain healthcare-provider mergers, acquisitions, and other affiliations. Under the “state action doctrine,” states may shield certain transaction and conduct from federal antitrust law if the state (1) has affirmatively expressed and clearly articulated an intent to displace federal antitrust law and replace it with state regulation, and (2) actively supervises the transaction or collaboration.
Concerned that federal antitrust law and FTC enforcement against healthcare mergers has been too stringent and prevents procompetitive transactions, several states have passed COPA (or “cooperative agreement”) laws to permit healthcare providers to enter into transactions that might otherwise be blocked by the FTC. Proponents of COPAs believe that they allow healthcare providers to enter into transactions that eliminate costly duplicative services, achieve clinical efficiencies, facilitate more integrated care, and enable other community health benefits.