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July 7, 2000

Doctor Cartels Bill Passes House 

Legislation that would allow doctors to bargain collectively with health plans through unregulated cartels passed the House of Representatives last week. 

•By a vote of 276-136, Congress elected to send the Healthcare Leadership Council-opposed legislation to the Senate.

•H.R. 1304, called by opponents the "OPEC for Doctors" bill, would give a special interest a broad antitrust exemption that would surely result in higher health care costs and more uninsured Americans.

Granting a blanket antitrust exemption is all about doctor income.

•H.R. 1304 would legalize doctor cartels, price-fixing and boycotts.

•The House, under intense pressure from the American Medical Association, rejected two separate amendments that would have prohibited these cartels from negotiating on fees.

•A new, independent analysis conservatively estimates that physicians will gain fee increases of 20 percent.

The bill gives the antitrust exemption of a labor union, but the unaccountability of a cartel like OPEC.

•All other antitrust exemptions have some corresponding oversight.  For instance, labor unions must answer to the National Labor Relations Board and insurance companies must answer to state insurance commissioners under "state action doctrine."

•The House rejected an amendment that would have instituted modest oversight by the Federal Trade Commission or the Department of Justice.  New cartels would have had to seek certification that their ability to bargain collectively would promote competition and enhance health care quality.

A blanket antitrust exemption would result in predictable consequences:  harm to consumers.

•A new, independent study estimates that H.R. 1304 would increase health care costs by 8.6 percent and add 3 million more Americans to the uninsured rolls by 2005.

•The new study concludes that the 3-year sunset of H.R. 1304 will likely accelerate the formation of cartels, rather than slow it, as the Congressional Budget Office estimated.  The infrastructure of physician organizations and the compelling financial incentives to form cartels will mean formation sooner, not later.

•Cartels of doctors could force out their nonphysician provider competitors, thus limiting consumer choice in a given market.

The House has passed the most anti-consumer, anti-competitive legislation imaginable.  The Senate should reject H.R. 1304 as the product of raw, special interest politics.  If Senators care about putting the health care consumer first, then they must say no to doctor cartels.

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