Healthy Competition for Better Care Act
Summary
The "Healthy Competition for Better Care Act" aims to ban anticompetitive terms in facility and insurance contracts that limit access to higher quality, lower cost care. It amends the Public Health Service Act, the Employee Retirement Income Security Act of 1974, and the Internal Revenue Code of 1986. The goal is to promote competition among healthcare providers and insurers.
The bill prohibits agreements that restrict health plans from directing patients to other providers or offering incentives for using specific providers. It also prevents agreements that require plans to contract with affiliates or agree to payment rates for entities not party to the original agreement. Exceptions are made for certain HMOs and value-based network arrangements.
Regulations to implement these changes will be promulgated by the Secretaries of Health and Human Services, Labor, and the Treasury within one year of enactment. The amendments will apply to contracts entered into, amended, or renewed 18 months after enactment.
Expected Effects
This act will likely increase competition among healthcare providers and insurers. It could lead to lower healthcare costs and improved quality of care for consumers. The act may also give health plans more flexibility in designing their networks and negotiating rates.
Potential Benefits
- Increased competition: By banning anticompetitive terms, the act promotes a more competitive healthcare market.
- Potential for lower costs: Increased competition may drive down healthcare costs for consumers and employers.
- Greater network flexibility: Health plans gain more freedom to design networks and steer patients to cost-effective providers.
- Incentives for quality: The act supports value-based care models, which incentivize providers to deliver high-quality care.
- Consumer choice: Patients may have more choices in selecting healthcare providers.
Potential Disadvantages
- Potential for unintended consequences: The regulations could inadvertently limit legitimate business arrangements.
- Implementation challenges: Defining and enforcing "anticompetitive terms" may prove difficult.
- Possible disruption of existing contracts: The act could disrupt existing contracts between providers and insurers.
- Risk of litigation: The new regulations may lead to legal challenges from affected parties.
- Limited impact: The exceptions for HMOs and value-based networks could reduce the act's overall effectiveness.
Constitutional Alignment
The "Healthy Competition for Better Care Act" appears to align with the Commerce Clause (Article I, Section 8, Clause 3) of the U.S. Constitution, which grants Congress the power to regulate interstate commerce. Healthcare and insurance industries operate across state lines, making them subject to federal regulation.
The act also indirectly relates to the "general Welfare" clause (Article I, Section 8, Clause 1) by aiming to improve healthcare access and affordability. However, the Tenth Amendment reserves powers not delegated to the federal government to the states, which could raise questions about the extent of federal intervention in healthcare contracts.
Overall, the act seems to fall within the scope of federal authority under the Commerce Clause, but its implementation should consider potential impacts on state regulatory powers.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).