Merger Chaos at the FTC?

If there's one indisputable legal and business trend in the health care industry over the past 10-20 years, it's the move toward greater consolidation of health care providers. Some observers praise consolidation on efficiency grounds (cutting duplication and waste --> lower costs --> lower prices for patients), while others decry consolidation because it concentrates market power and lessens competition, which leads to higher prices for patients.  

The mechanism for resolving these claims in connection with large proposed mergers is the statute known as Hart-Scott-Rodino (H-S-R), along with its numerous FTC, DOJ, and SCOTUS interpretations. But according to Daniel Sokol and Dick Pierce, the times they are a-changin', though where federal policy is headed is anyone's guess. 

In his Jotwell essay (May 25, 2023), Pierce argues that two articles by Sokol "are required reading for anyone who is interested in antitrust law, administrative law, government regulation, or corporate law." That's just about everyone in the legal profession, but I'll throw in health care law for good measure.

The catalyst for change is Lina Khan, the Biden Administration's chair of the FTC. As described by Pierce, 

Khan has made it clear that she disagrees with virtually every characteristic of the [FTC/DOJ merger]  guidelines, including the guidelines’ goals. She rejects the goal of maximizing consumer welfare, which the Justice Department and the FTC have pursued for the last 50 years. Instead, she has emphasized the need to protect competitors from large firms that charge low prices—a goal that the enforcement agencies and the Supreme Court disavowed 50 years ago. Khan cannot further her stated goals by applying the 2010 guidelines.

The Pierce essay is a quick and easy read. The implications of Chair Khan's views on mergers portends an era that will be messy and uncertain.