Is There Too Little Antitrust Enforcement in the Us Hospital Sector?

56 Pages Posted: 13 May 2024

See all articles by Zarek Brot-Goldberg

Zarek Brot-Goldberg

University of Chicago - Harris School of Public Policy

Zack Cooper

Yale University

Stuart Craig

Wisconsin School of Business

Lev Klarnet

Harvard Business School

Date Written: April 2024

Abstract

From 2002 to 2020, there were over 1,000 mergers of US hospitals. During this period, the Federal Trade Commission (FTC) took enforcement actions against 13 transactions. However, using the FTC’s standard screening tools, we find that 20% of these mergers could have been predicted to meaningfully lessen competition. We then show that, from 2010 to 2015, predictably anticompetitive mergers resulted in price increases over 5%. 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.

Suggested Citation

Brot-Goldberg, Zarek and Cooper, Zack and Craig, Stuart and Klarnet, Lev, Is There Too Little Antitrust Enforcement in the Us Hospital Sector? (April 2024). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2024-59, Available at SSRN: https://ssrn.com/abstract=4826708 or http://dx.doi.org/10.2139/ssrn.4826708

Zarek Brot-Goldberg (Contact Author)

University of Chicago - Harris School of Public Policy ( email )

1155 East 60th Street
Chicago, IL 60637
United States

Zack Cooper

Yale University ( email )

493 College St
New Haven, CT CT 06520
United States

Stuart Craig

Wisconsin School of Business ( email )

Lev Klarnet

Harvard Business School ( email )

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