Health-care markets have become much more consolidated over time. That consolidation has generally resulted in higher prices without gains in quality or other improvements. There are many health-care markets where competition can be effective, but the right policies are needed to support that competition. In other markets, robust competition would be more difficult to achieve, necessitating a different policy approach.
Gaynor proposes three types of policy reforms that would increase competition in health care and improve market functioning.
Reduce or eliminate policies that encourage consolidation or that impede entry and competition.
Strengthen antitrust enforcement so that federal and state antitrust enforcement agencies can act effectively to prevent and remove harms to competition.
Create an agency responsible for monitoring and overseeing health-care markets, and give that agency the authority to flexibly intervene when markets are not working.