UNITED STATES OF AMERICA

UNITED STATES OF AMERICA

Federal Trade Commission

WASHINGTON, D.C. 20580

Office of Policy Planning

February 11, 2025

Senator Ed Charbonneau

Chair, Health & Provider Services Committee

Indiana State Senate

200 W. Washington St.

Indianapolis, IN 46204

Re:

Senate Bill 119

Dear Senator Charbonneau,

I am the Acting Director of the Federal Trade Commission’s (“FTC”) Office of Policy

Planning. My office is charged with engaging with state legislatures, regulatory boards, and

officials on competition and consumer protection principles to champion the interests of the

American people. Promoting competition, spurring innovation, and lowering prices in the

healthcare sector are among Chairman Andrew Ferguson’s highest priorities for the FTC. I write

this letter to advance those objectives.

I understand that the Indiana legislature is considering Senate Bill 119 (“SB119” or “Bill”),

which would repeal the certificate of public advantage (“COPA”) statute concerning hospital

mergers.1 This letter responds to your February 6, 2025, inquiry regarding the competition and

consumer protection implications of SB119. I write to highlight the FTC’s prior work in this area

that you may find informative as you consider this Bill.

Vigorous competition among hospitals in an open marketplace provides patients with the

benefits of lower prices, higher quality of care, greater access, and increased innovation; it also

supports improved wages and benefits for hospital employees.2 With the FTC Act and Section 7

of the Clayton Act, “Congress empowered the FTC to weed out those mergers whose effect ‘may

be substantially to lessen competition’ from those that enhance competition.”3 The FTC has

considerable experience in evaluating proposed hospital, outpatient facility, and physician group

1

Indiana General Assembly 2025 Session, Senate Bill 119 (introduced Jan. 8, 2025), https://iga.in.gov/pdfdocuments/124/2025/senate/bills/SB0119/SB0119.01.INTR.pdf.

2

See e.g., Nat’l Soc. Of Prof. Eng’rs v. United States, 435 U.S. 679, 695 (1978) (The antitrust laws “reflect a legislative

judgment that ultimately competition will produce not only lower prices, but also better goods and services. The heart

of our national economic policy long has been faith in the value of competition.” (cleaned up)); FTC POLICY

PERSPECTIVES ON CERTIFICATES OF PUBLIC ADVANTAGE 3–4 (Aug. 15, 2022) (hereinafter “2022 FTC Staff COPA

Paper”), https://www.ftc.gov/system/files/ftc_gov/pdf/COPA_Policy_Paper.pdf.

3

FTC v. H.J. Heinz Co., 246 F.3d 708, 713 (D.C. Cir. 2001) (cleaned up).

mergers to determine whether they may substantially lessen competition and harm Americans.4

When warranted, the FTC has challenged these mergers in court.5

COPA statutes attempt to immunize hospital mergers from antitrust scrutiny, often leaving

the FTC unable to challenge even mergers to a monopoly.6 In effect, COPA statutes protect

anticompetitive mergers, and they instead impose governmental oversight and regulation in an

attempt to mitigate the competitive harm. Unfortunately, the consequences of COPAs are still often

harmful to consumers. As a recent FTC policy paper reports, empirical evidence on COPAs

indicates that, in the long run, hospital mergers shielded with COPAs often lead to higher prices

and reduced quality of care for Americans seeking healthcare.7 Such outcomes occur because

providers shielded by COPAs often ultimately enjoy unconstrained market power.8 The existing

research also shows that COPAs’ purported benefits are flawed and unsubstantiated.9 For these

reasons, the FTC has previously asked states with existing COPA laws to consider repealing those

laws if they do not have an active COPA in place.10 And FTC staff has commended states that

have repealed their COPA laws.11

Currently, there is no active COPA in place in Indiana. On September 5, 2024, the FTC

Commissioners unanimously voted to authorize staff to submit a public comment urging the

Indiana Department of Health to deny the then-pending COPA application filed by Union Health

and Terre Haute Regional Hospital in connection with their proposed merger.12 After conducting

a thorough investigation of the proposed transaction, FTC staff concluded that it “was likely to

lead to higher costs and worse healthcare outcomes for Indiana consumers, as well as lower wage

growth for hospital workers.”13 The hospitals voluntarily withdrew their COPA application in

4

See FTC, OVERVIEW OF FTC ACTIONS IN HEALTH CARE SERVICES AND PRODUCTS 51–91 (Jan. 2025),

https://www.ftc.gov/system/files/ftc_gov/pdf/Overview-Healthcare.pdf.

5

See id.

6

See FTC, Certificates of Public Advantage (COPAs), FTC.GOV (noting that “COPAs immunize mergers and

collaborations from antitrust scrutiny under the state action doctrine” and describing the FTC’s state-focused actions),

https://www.ftc.gov/copa.

7

2022 FTC Staff COPA Paper at 7–12.

8

Ibid.

9

Id. at 4–6.

10

Id. at 1. After states have COPAs in place, it may become more difficult to remove a COPA statute because doing

so could also eliminate oversight of any existing COPAs. Id. at 8. The FTC has also consistently advocated that states

not enact COPA legislation. See e.g., FTC Staff Comment to Hon. Mike Pushkin, West Virginia State Senate,

Concerning S.B. 597, Intended to Exempt Health Care Providers Subject to Cooperative Agreements from the

Antitrust Laws (Mar. 9, 2016), https://www.ftc.gov/system/files/documents/advocacy_documents/ftc-staff-commentwest-virginia-house-delegates-regarding-sb-597-competitive-implications-provisions/160310westvirginia.pdf; FTC

Staff Comment to New York State Department of Health, Concerning Certificate of Public Advantage Applications,

Intended to Exempt Performing Provider Systems from the Antitrust Laws (Apr. 22, 2015),

https://www.ftc.gov/system/files/documents/advocacy_documents/ftc-staff-comment-center-health-care-policyresource-development-office-primary-care-health-systems/150422newyorkhealth.pdf.

11

See FTC Press Release, FTC Policy Director Issues Statement Commending Maine’s Repeal of Certificate of Public

Advantage Law (Jun. 13, 2023), https://www.ftc.gov/news-events/news/press-releases/2023/06/ftc-policy-directorissues-statement-commending-maines-repeal-certificate-public-advantage-law.

12

FTC Staff Submission to Indiana Health Department Regarding the COPA Application of Union Health and Terre

Haute Regional Hospital (Sept. 5, 2024), https://www.ftc.gov/system/files/ftc_gov/pdf/in_copa_comment_9-524_public_redacted.pdf.

13

Id. at 1, 4.

2

November 2024—days before the decision deadline—stating an intent to file a new application at

a later time.14 We understand that the same two hospitals have, just recently, reapplied for a COPA.

I attach for your and your colleagues’ review the above-referenced policy paper (FTC

Policy Perspectives on Certificates of Public Advantage), Key COPA Facts, and the September

2024 FTC Staff Submission to the Indiana Health Department Regarding the COPA Application

of Union Health and Terre Haute Regional Hospital. I hope that the FTC’s research, analyses, and

findings to date concerning COPAs are valuable as you consider SB119. Please do not hesitate to

contact the FTC’s Office of Policy Planning if we can be of further assistance.

Sincerely,

/s/Clarke Edwards

___________________

Clarke Edwards

Acting Director

Office of Policy Planning

Attachments

14

See Union Health, Union Health COPA Application Update (Nov. 25, 2024), https://www.union.health

/news/unionhealthcopaapplicationupdate. See also FTC Press Release, Statement Regarding Union Health’s COPA

Application Withdrawal (Nov. 26, 2024), https://www.ftc.gov/news-events/news/press-releases/2024/11/statementregarding-union-healths-copa-application-withdrawal.

3