UNITED STATES OF AMERICA 

Federal Trade Commission 

WASHINGTON, D.C. 20580 

Office of Policy Planning 

Bureau of Competition 

Bureau ofEconomics 

June 5, 2023 

Representative Larry W. Potts 

North Carolina House Health Committee 

North Carolina General Assembly 

300 N. Salisbury Street 

Raleigh, NC 27603 

Re: North Carolina Senate Bill 743, Purporting to Give State Action Defense to 

UNC Health's Collaborative Activities 

Dear Representative Potts and Members of the House Health Committee: 

The staff of the Federal Trade Commission' s ("FTC" or "Commission") Office of 

Policy Planning, Bureau of Competition, and Bureau of Economics (collectively, "FTC 

staff').1 respectfully submits this letter regarding the impact ofNorth Carolina Senate Bill 

743 ("S-743").2 on competition for healthcare services. The proposed bill purportedly 

would provide the University of North Carolina Health Care System ("UNC Health"), as 

well as the public or private entities with which it collaborates, with a defense from antitrust 

enforcement action for any otherwise unlawful merger or coordinated activity. The 

collaborative activities that the proposed bill authorizes could include the kinds of 

acquisitions, market allocation, information sharing, and joint contract negotiations that 

reduce competition among healthcare providers and lead to patient harm in the form of 

higher healthcare costs, lower quality, reduced innovation, and reduced access to care, as 

well as depressed wages for hospital employees. For the reasons described below, FTC 

staff urges the North Carolina General Assembly to reconsider whether UNC Health needs 

state action protection to engage in beneficial collaborative activities. We are aware that a 

North Carolina Senate Budget Proposal also included purported state action protection for 

East Carolina University, and FTC staff would have similar concerns about those types of 

provisions as it does for the provision regarding UNC Health . .3 

FTC staff recognizes that not all collaboration among healthcare providers 

substantially lessens competition or otherwise violates the antitrust laws. We also 

recognize there are bona fide regulatory approaches that may be appropriate for 

implementing a variety ofimportant public policy goals. We are concerned, however, 

that the proposed legislation is based on inaccurate premises regarding the scope ofthe 

Page 1 of9 
antitrust laws, the need for exemptions from those laws, and the value of competition 

among healthcare providers. The FTC has raised concerns about similar legislation in 

other states that purport to confer broad antitrust defenses to public health entities ..4 In 

addition, the FTC has advocated against the use ofthe state action doctrine to shield 

specific hospital mergers from antitrust enforcement liability,.5 as well as federal and state 

legislative proposals that seek to create antitrust exemptions for collective negotiations by 

healthcare providers ..6 

Antitrust carve-outs are unnecessary for UNC Health to engage in appropriate 

collaborative activities. The antitrust laws are not a barrier to the formation of healthcare 

collaborations that benefit patients and employers without raising competitive concerns, as 

explained in guidance issued by the Federal Trade Commission.? Because such 

collaborations already are permissible under the antitrust laws, the main effect of S-743 

would be to shield mergers and conduct that would violate the antitrust laws by depriving 

patients and workers of the benefits of competition without efficiencies or quality 

improvements. Therefore S-743 would likely lead to increased healthcare costs - in the 

form of higher premiums, co-pays, deductibles, and other out-of-pocket expenses - and 

reduced quality and access to healthcare services for North Carolina patients. It could also 

result in reduced wages and benefits for healthcare workers. 

I. FTC's Interest and Experience 

The FTC's mission includes promoting fair competition in healthcare markets that 

benefits patients, hospital employees, and the public at large. To carry out this mission, 

Congress has charged the FTC with enforcing the Clayton Act, which prohibits mergers 

and acquisitions whose effect may be substantially to lessen competition or tend to create 

a monopoly..8 In addition, the FTC enforces the Federal Trade Commission Act, which 

prohibits unfair methods of competition and unfair or deceptive acts or practices in or 

affecting commerce . .9 Pursuant to its statutory mandate, the FTC investigates mergers and 

acquisitions, business practices, and other activities that may violate the Clayton Act or the 

FTC Act and, where there is reason to believe those laws have been violated, brings 

enforcement actions to stop and remedy such violations. 

Vigorous competition among healthcare providers in an open marketplace provides 

patients with the benefits of lower prices, higher quality, greater access, innovation for 

goods and services, and improved wages and benefits for employees..10 Anticompetitive 

mergers and conduct in healthcare markets have long been a focus of FTC law 

enforcement, research, and advocacy..11 The FTC also has significant experience with 

evaluating the effects of efforts by state and local governments to shield certain market 

participants from antitrust liability, including in healthcare markets. 

II. North Carolina Senate Bill 743 

North Carolina Senate Bill 743 was introduced on April 6, 2023, and an amended 

second edition unanimously passed in the North Carolina Senate on May 1, 2023..12 S-743 

is now being considered in the North Carolina House. The stated purposes ofS-743 include 

Page 2 of9 
"clarifying the authority of [UNC Health] to conduct operations in the best interests ofthe 

state for the purpose of creating a statewide health system ofhigh quality" and "expanding 

[UNC Health's] operating authorities and personnel flexibilities.".13 

S-743 describes UNC Health as "a State agency and political subdivision governed 

and administered as an affiliated enterprise of The University of North Carolina" in 

accordance with a newly proposed General Statutes framework titled Chapter 116, Article 

37..14 S-743 describes the governance structure and authority of the Board of Directors of 

UNC Health, which would be able to authorize UNC Health to enter into contracts and 

formal agreements ..15 The Board's general powers and duties, as explicitly stated in S-743, 

include a broad range of contractual, operational, and financial activities that it deems 

necessary "to carry out the patient care, education, research, and public service mission" 

of UNC Health - most notably the authority to acquire or enter into any arrangement with 

other public or private hospital and healthcare facilities ..16 

Included in S-743 is a provision that purports to extend state action "immunity" 

from antitrust liability to UNC Health, as well as any private and public entities with which 

it collaborates ..17 This purported immunity would cover "cooperative agreements with any 

other entity for the provision of health care, including the acquisition, allocation, sharing, 

or joint operation of hospitals or any other health care facilities or health care provider, 

without regard to their effect on market competition.".18 FTC staff takes no position at this 

time on whether UNC Health legally qualifies as an arm of the state or whether S-743 

satisfies the requirements ofthe state action doctrine. Both are fact-intensive inquiries that 

would require further investigation ..19 

III. State Action Is Unnecessary Because the Antitrust Laws Already Permit 

Beneficial Health Care Collaborations that Are Competitively Benign 

The state action provision of S-743 appears to be based on two fundamentally 

flawed premises: that beneficial collaborations among otherwise independent healthcare 

providers are prohibited under the antitrust laws, and that the state action defense is 

necessary to enable such collaborations. The antitrust laws are not an impediment to 

competitively neutral collaborations, including certain joint ventures or other types of care 

coordination, among healthcare providers that may reduce costs and benefit patients. The 

federal antitrust agencies also recognize that the acquisition of a failing firm, which cannot 

meet its financial obligations and would exit the market without the acquisition, is not 

likely to cause competitive harm ..20 

FTC staff is concerned that S-743 may encourage UNC Health to engage in the 

kinds ofacquisitions and collaborations that would harm patients, employers, and workers. 

Indeed, there is a significant and growing body of empirical economic research showing 

that increased consolidation and certain kinds of coordination among healthcare providers 

increase the risk of higher prices without any improvements in quality ..21 The benefits of 

competition also apply in rural areas facing economic challenges. Indeed, the North 

Carolina General Assembly has recognized the value of healthcare competition through 

Page 3 of9 
other proposed legislation .. 

22 Furthermore, recent studies show that consolidation among 

health systems results in lower wages and reduced benefits for employees .. 

23 

IV. Antitrust Exemptions That Attempt to Shield Otherwise Anticompetitive 

Conduct Pose a Substantial Risk of Harm and Are Disfavored 

Because the antitrust laws already permit competitively neutral collaborations 

among healthcare providers that benefit patients, no special "exemption" or "immunity" 

from antitrust liability is necessary to ensure that such collaborations occur. The U.S. 

Supreme Court has reiterated its long-standing position that "the antitrust laws' values of 

free enterprise and economic competition" make such special exemptions or immunities 

"disfavored.".

24 There is no reason to treat the healthcare industry differently with regard 

to application of the antitrust laws. Indeed, in the healthcare industry, just like in other 

industries, consumers and workers benefit from fair and vigorous competition and are 

harmed by anticompetitive conduct and transactions .. 

25 

Healthcare providers increasingly seek exemptions from the antitrust laws that 

would extend to mergers and various forms ofjoint conduct. Experience has taught us that 

antitrust exemptions threaten broad harm to many while benefitting only a select few. FTC 

staff is concerned that S-743 would encourage precisely the types of agreements among 

competitors that likely would not pass muster under the antitrust laws - mergers and 

conduct that would reduce competition, create or entrench monopolies, raise prices, reduce 

quality, and provide few or no benefits to patients, employers, or workers. Any effort to 

shield such harmful mergers and conduct from antitrust enforcement is likely to harm North 

Carolina citizens. 

To evaluate the potential consequences of S-743, consider the results of North 

Carolina's last attempt to shield a healthcare provider from antitrust liability. In 1995, 

Memorial Mission Hospital and St. Joseph's Hospital entered into a cooperative agreement 

under North Carolina's certificate of public advantage ("COPA") statute, which allowed 

them to engage in certain collaborative activities and eventually merge to form Mission 

Health System without facing an antitrust enforcement challenge. For nearly 20 years, 

Mission Health System operated under the state's COPA regulatory oversight, which was 

intended to mitigate the anticompetitive effects resulting from a loss of competition. 

However, recent empirical studies found substantial increases in commercial inpatient 

prices during the period in which the COP A was in effect, and even greater price increases 

after the COP A was repealed .. 

26 Other stakeholders suggest that HCA Healthcare, which 

acquired Mission Health System in 2019, has been able to exercise its market power to the 

detriment ofNorth Carolina healthcare patients and workers .. 

27 

FTC staff is concerned about a similar outcome with UNC Health ifS-743 is passed 

in its current form and the state action provision remains intact. Even when operating as a 

not-for-profit, like UNC Health, the research shows that hospitals with substantial market 

power are often able to demand higher rates (i.e., prices), which are then passed on to 

consumers in the form of higher premiums, copayments, deductibles, and other out-ofPage 4 of9 
pocket expenses..28 Indeed, there is at least one example of UNC Health appearing to 

engage in behavior violating the antitrust laws to the detriment ofworkers .. 

29 

V. Conclusion 

In summary, FTC staff believes that the state action provision included in S-743 is 

unnecessary to facilitate beneficial collaborations between UNC Health and other 

healthcare providers. We recognize the state interest in weighing values other than 

competition and determining when those values should govern, and we respect the 

democratic role of state sovereigns in deciding matters of state and local policy. We are 

nonetheless concerned that S-743 would likely foster anticompetitive conduct to the 

detriment of North Carolina healthcare patients and workers. FTC staff urges the North 

Carolina General Assembly to carefully consider whether excepting UNC Health from 

antitrust liability- especially the broad immunity S-743 purports to grant - would further 

legitimate public policy goals or, instead, result in higher prices for patients while reducing 

healthcare quality and access. 

The FTC will investigate and challenge transactions that are anticompet1t1ve, 

including in situations where legal defenses are asserted based on the state action doctrine 

and where the state fails to meet the necessary requirements. 

Respectfully submitted, 

Isl Elizabeth Wilkins, Director 

Office of Policy Planning 

Isl Holly Vedova, Director 

Bureau of Competition 

Isl Aviv Nevo, Director 

Bureau of Economics 

Cc: Senator Ralph Hise, Senate Bill 743 Sponsor 

Senator Joyce Krawiec, Senate Bill 743 Sponsor 

1 This letter represents the views of the FTC's Office ofPolicy Planning, Bureau of Competition, and 

Bureau of Economics. It does not necessarily represent the views of the Commission or of any individual 

Commissioner. The Commission, however, has voted to authorize staff to submit this letter. 

2 General Assembly ofNorth Carolina Session 2023, Senate Bill 743 - Second Edition (adopted Apr. 20, 

2023), Enacting New Article 37, General Statutes Chapter 116, pertaining to the University ofNorth 

Carolina Health Care System, https://www.ncleg.gov/Sessions/2023/Bil1s/Senate/PDF/S743v2.pdf. 

Page 5 of9 
3 General Assembly ofNorth Carolina Session 2023, Senate Committee Substitute for House Bill 259, 

2023 Appropriations Act, as amended by the Senate Appropriations/Base Budget Committee and the 

Senate Finance Committee (Fifth Edition Engrossed May 18, 2023), Article 39, East Carolina University 

Health Care Operations§ 116-360.40., 

https://www.ncleg.gov/Sessions/2023/Bills/House/PDF /H259v5 .pdf. 

4 See FTC StaffComment to the Alabama State Senate Regarding HB 241 and SB 243, Which Would 

Exempt Health Care Collaborations From Federal Antitrust Laws (May 2016), 

https://www.ftc.gov/system/files/documents/advocacy documents/ftc-staff-comment-alabama-statesenate-regarding-alabama-house-bill-241-senate-bill-243/160504commentalabama.pdf; FTC Staff 

Comment to New York State Senator Ranzenhofer and New York State Assemblyman Abinanti 

Concerning SB 2647 and AB 2888 Authorizing Certain Agreements for the Creation and Operation of a 

Health Care Delivery System Network (Jun. 2015), 

https://www.ftc.gov/system/files/documents/advocacy documents/ftc-staff-comment-new-york-statesenator-ranzenhofer-new-york-state-assemblyman-abinanti-concerning/150605nypublichealthletter.pdf. 

5 See FED. TRADE COMM'N, Certificates ofPublic Advantage (COPAs), www.ftc.gov/copa. 

6 See, e.g., FTC Staff Comment to Sen. Chip Shields, Or. State Legislature, Concerning S.B. 231-A, 

Intended to Exempt Certain Collaborations Among Competing Health Care Providers and Payers 

Participating in a Primary Care Transformation Initiative (May 2015), 

https://www.ftc.gov/system/files/documents/advocacy documents/ftc-staff-comment-regarding-oregonsenate-bill-231 a-which-includes-language-intended-provide-federal/ 150519oregonstaffletter. pdf; FTC 

Staff Comment to Sen. Catherine Osten and Rep. Peter Tercyak, Conn. Gen. Assembly, Concerning H.B. 

6431, Intended to Exempt Health Care Collaboratives from the Antitrust Laws (Jun. 2013), 

https://www.ftc.gov/sites/default/files/documents/advocacy documents/ftc-staff-comment-connecticutgeneral-assembly-labor-and-employees-committee-regarding-connecticut/130605conncoopcomment.pdf; 

FTC Staff Comment to Sen. John J. Bonacic, N.Y. State Senate, Concerning N.Y. Senate Bill S.3186-A, 

Intended to Permit Collective Negotiations by Health Care Providers (Oct. 2011), 

https://www.ftc.gov/sites/default/files/documents/advocacy documents/ftc-staff-comment-honorablejohn-j. bonacic-conceming-new-york-s. b.3186-allow-health-care-providers-negotiate-collectively-healthplans/111024nyhealthcare. pdf; FTC StaffComment to Sens. Coleman and Kissel and Reps. Fox and 

Hetherington, Conn. Gen. Assembly, Concerning Connecticut H.B. 6343, Intended to Exempt Members 

of Certified Cooperative Arrangements from the Antitrust Laws (Jun. 2011), 

https://www.ftc.gov/sites/default/files/documents/advocacy documents/ftc-staff-commentsenatorscoleman-andkissel-and-representativesfox-and-hetherington-concerning.b.6343intendedtoexempt-members-certified-cooperative-arrangements-antitrust-laws/110608chc.pdf; FTC Staff 

Comment to the Hon. Elliott Naishtat Concerning Tex. S.B. 8 to Exempt Certified Health Care 

Collaboratives from the Antitrust Laws (May 2011). All advocacies are available at 

https://www.ftc.gov/policy/advocacy-filings. 

7 See, e.g., FTC Healthcare Advisory Opinions (explaining FTC staff's public analysis ofspecific 

healthcare provider collaborations), https:/ /www.ftc.gov/system/files/ftc gov/pdf/Overview-AdvisoryOpinions.pdf; FED. TRADE COMM'N & U.S. DEP'T OF JUSTICE, ANTITRUST GUIDELINES FOR 

COLLABORATIONS AMONG COMPETITORS (2000), 

https:/ /www.ftc.gov/sites/ default/files/ documents/public events/joint-venture-hearings-antitrustguidelines-collaboration-among-competitors/ftcdoj guidelines-2. pdf. 

8 See Clayton Act, 15 U.S.C. § 18; Federal Trade Commission Act, 15 U.S.C. § 45. 

9 Id. 

10 See Nat'l Soc. ofProf. Eng'rs v. United States, 435 U.S. 679, 695 (1978) (The antitrust laws reflect "a 

Page 6 of9 
legislative judgment that, ultimately, competition will produce not only lower prices, but also better 

goods and services . . .. The assumption that competition is the best method of allocating resources in a 

free market recognizes that all elements of a bargain - quality, service, safety, and durability- and not 

just the immediate cost, are favorably affected by the free opportunity to select among alternative 

offers."). 

11 See, e.g. , FED. TRADE CoMM'N, Competition in the Health Care Marketplace, https://www.ftc.gov/tipsadvice/competition-guidance/industry-guidance/health-care; FED. TRADE CoMM'N, OVERVIEW OF FTC 

ACTIONS IN HEALTH CARE SERVICES AND PRODUCTS (2022), 

https://www.ftc.gov/systern/files/ftc gov/pdf/2022.04.08%20Overview%20Healthcare%20%28fina1%29 

.pdf; Joseph Farrell, Paul A. Pautler & Michael G. Vita, FED. TRADE CoMM'N, Economics at the FTC: 

Retrospective Merger Analysis with a Focus on Hospitals, 35 REV. INDUS. ORG. 369 (2009), 

http://link.springer.com/content/pdf/10.1007%2Fs11151-009-923l-2.pdf; FED. TRADE COMM'N, 

Examining Health Care Competition (Mar. 20-21, 2014), https://www.ftc.gov/news-events/eventscalendar/2014/03/examining-health-care-competition; FED. TRADE CoMM'N & U.S. DEP'T OF JUSTICE, 

Examining Health Care Competition (Feb. 24-25, 2015), https://www.ftc.gov/news-events/eventscalendar/2015/02/examining-health-care-competition; FED. TRADE COMM'N & U.S. DEP'T OF JUSTICE, 

IMPROVING HEALTH CARE: A DOSE OF COMPETITION (2004), 

https://www.ftc.gov/sites/default/files/documents/reports/improving-health-care-dose-competitionreport-federal-trade-commission-and-department-justice/040723healthcarerpt.pdf. 

12 General Assembly ofNorth Carolina Session 2023, Senate Bill 743 - Second Edition (adopted Apr. 20, 

2023), Enacting New Article 37, General Statutes Chapter 116, pertaining to the University ofNorth 

Carolina Health Care System, https://www.ncleg.gov/Sessions/2023/Bi1ls/Senate/PDF/S743v2.pdf. 

13 S-743 at 1. 

14 S-743 § 116-350.S(a). 

15 S-743 § 116-350.15(a)-(b). 

16 S-743 § 116-350.15( c ). 

17 We reference the term state action "immunity" as that is the language used in S-7 4 3. However, the state 

action doctrine is more properly described as a defense to antitrust liability, not an immunity from 

investigation or lawsuit. See, e.g., SmileDirectClub v. Battle, 4 F.4th 1274, 1277, 1280 (11th Cir. 2021) 

(en bane); SolarCity Corp. v. Salt River Project Agric. Improvement and Power Dist., 859 F.3d 720, 726 

(9th Cir. 2017); South Carolina State Bd. ofDentistry v. FTC, 455 F.3d 436,444 (4th Cir. 2006); Huron 

Valley Hosp. , Inc. v. City ofPontiac, 792 F.2d 563, 567 (6th Cir. 1986); Acoustic Sys., Inc. v. Wenger 

Corp., 207 F.3d 287,292 (5th Cir. 2000); Surgical Care Ctr. ofHammond v. Hosp. Serv. Dist. No. 1 of 

Tangipahoa Parish, 171 F.3d 231,234 (5th Cir. 1999) (en bane). 

18 S-743 § 116-350.70. 

19 To obtain a defense from antitrust enforcement liability for conduct by private actors that might 

otherwise violate the federal antitrust laws, the state action doctrine requires both a clear articulation of 

the state's intent to displace competition in favor ofregulation and that the state provide active 

supervision over the regulatory scheme or body. See N.C. State Bd. of Dental Exam'rs v. FTC, 135 S. 

Ct. 1101, 1114 (2015); FTC v. Phoebe Putney Health Sys., Inc., 133 S. Ct. 1003, 1013 (2013). 

20 See e.g., FTC Press Release, Bureau ofCompetition Director Issues Statement on FTCs Closure ofits 

Investigation ofConsummated Hospital Merger in Temple, Texas (Dec. 23, 2009), 

https:/ /www.ftc.gov/news-events/news/press-releases/2009/ 12/bureau-competition-director-issuesPage 7 of9 
statement-ftcs-closure-its-investigation-consummated-hospital. 

21 See, e.g., Zack Cooper, Stuart Craig, Martin Gaynor & John Van Reenen, The Price Ain't Right? 

Hospital Prices and Health Spending on the Privately Insured, 134 Q.J. ECON. 51 (2019), 

https://healthcarepricingproject.org/sites/default/files/Updated the price aint right qje.pdf; Nancy 

Beaulieu, Leemore Dafny, Bruce Landon, Jesse Dalton, lfedayo Kuye & J. Michael Mc Williams, 

Changes in Quality ofCare after Hospital Mergers and Acquisitions, 382 NEW ENG. J. MED. 51 (Jan. 2, 

2020), https:/ /www.nejm.org/doi/pdf/l 0.1056/NEJMsal 901383?articleTools=true; Martin Gaynor, Kate 

Ho & Robert Town, The Industrial Organization ofHealth-Care Markets, 53 J. ECON. LITERATURE 235 

(2015), https://www.researchgate.net/publication/278676719 The Industrial Organization of HealthCare Markets; Jeff Goldsmith, Lawton R. Bums, Aditi Sen, & Trevor Goldsmith, Integrated Delivery 

Networks: In Search ofBenefits and Market Effects, NAT'LACAD. OF SOCIAL INSURANCE (Feb. 2015), 

https://www.nasi.org/sites/default/files/research/Integrated Delivery Networks In Search of Benefits 

and Market Effects.pdf; Katherine Baicker & Helen Levy, Coordination versus Competition in Health 

Care Reform, 369 NEW ENG. J. MED. 789 (2013), 

https://www.nejm.org/doi/full/l0.1056/NEJMp1306268; Martin Gaynor & Robert Town, The Impact of 

Hospital Consolidation- Update (Robert Wood Johnson Found., Synthesis Project Report, June 2012), 

http://www.rwjf.org/content/darn/farm/reports/issue briefs/2012/rwjf73261 ; Paul B. Ginsburg, Wide 

Variation in Hospital and Physician Payment Rates Evidence ofProvider Market Power, Center for 

Studying Health System Change, Research BriefNo. 16 (Nov. 2010), 

http://www.hschange.com/CONTENT/ l 162/; Robert A. Berenson, Paul B. Ginsburg & Nicole Kemper, 

Unchecked Provider Clout in California Foreshadows Challenges to Health Reform, 29 HEALTH 

AFFAIRS 699 (2010), http://content.healthaffairs.org/content/29/4/699.full; Lawton Robert Bums & 

Ralph W. Muller, Hospital-Physician Collaboration: Landscape ofEconomic Integration and Impact on 

Clinical Integration, 86 MILBANK Q. 375 (2008), http://onlinelibracy.wiley.com/doi/10.1111/j.1468-

0009.2008.00527.x/epdf; William B. Vogt & Robert Town, How has hospital consolidation affected the 

price and quality ofhospital care? (Robert Wood Johnson Found. Synthesis Project Report, Feb. 2006), 

http://www.rwjf.org/files/research/no9researchreport.pdf; Cory Capps & David Dranove, Hospital 

Consolidation & Negotiated PPO Prices, 23 HEALTH AFFAIRS 175 (2004), 

http://content.healthaffairs.org/content/23/2/175.full. 

22 See, e.g., General Assembly ofNorth Carolina Session 2023, House Bill 737, Preserving Competition in 

Health Care, https://www.ncleg.gov/Sessions/2023/Bills/House/PDF /H73 7v l .pdf ( establishing a 

hospital merger notice, review, and monitoring process for the North Carolina Attorney General's office 

and requiring the Attorney General to consider "[w ]hether the proposed transaction complies with all 

applicable State and federal laws and regulations, including antitrust laws." 13 lE-214.32 (a)(5)); General 

Assembly ofNorth Carolina Session 2023, Senate Bill 48, Repeal Certificate ofNeed Laws, 

https:/ /www.ncleg.gov/Sessions/2023/Bills/Senate/PDF /S48v l .pdf. 

23 See, e.g., Elena Prager & Matt Schmitt, Employer Consolidation and Wages: Evidence from Hospitals, 

111 AM. ECON. REV. 397 (2021), https://www.aeaweb.org/articles?id=10.l257/aer.20190690; Daniel 

Arnold & Christopher Whaley, Who Paysfor Health Care Costs? The Effects ofHealth Care Prices on 

Wages, (2021 working paper), https://www.ehealthecon.org/pdfs/Whaley.pdf. 

24 FTC v. Phoebe Putney Health Sys., Inc., 133 S. Ct. 1003, 1010 (2013) (quoting FTC v. Ticor Title Ins. 

Co., 504 U.S. 621, 636 (1992)). See also North Carolina State Bd. of Dental Exam'rs v. FTC, 135 S. Ct. 

1101, 1117 (2015) ("The Sherman Act protects competition while also respecting federalism. It does not 

authorize the States to abandon markets to the unsupervised control of active market participants, 

whether trade associations or hybrid agencies. If a State wants to rely on active market participants as 

regulators, it must provide active supervision if state-action immunity under Parker is to be invoked."). 

25 Phoebe Putney, 133 S. Ct. at 1015 (state legislature's objective of improving access to affordable health 

care does not logically suggest contemplation of anticompetitive means, and "restrictions [imposed upon 

Page 8 of9 
hospital authorities] should be read to suggest more modest aims."). As the U.S. Court of Appeals for the 

Fourth Circuit has observed, "[fJorewarned by the [Supreme Court's] decision in National Society of 

Professional Engineers ... that it is not the function of a group of professionals to decide that 

competition is not beneficial in their line ofwork, we are not inclined to condone anticompetitive 

conduct upon an incantation of 'good medical practice."' Va. Acad. of Clinical Psychologists v. Blue 

Shield ofVa., 624 F.2d 476,485 (4th Cir. 1980). 

26 See FED. TRADE CoMM'N, FTC Policy Perspectives on Certificates ofPublic Advantage at 8 (Aug. 15, 

2022), https://www.ftc.gov/system/files/ftc gov/pdf/COPA Policy Paper.pdf. 

27 See, e.g., Letter from North Carolina Attorney General's office to North Carolina Department ofHealth 

and Human Services regarding Mission Health (Jul. 25, 2022), 

https:/ /info.ncdhhs. gov/ dhsr/ coneed/ comments/2022/june/Buncombe-Acute-Care-Beds-Project-ID-B12232-22-Mission-Hospital-Comments-by-AG-Josh-Stein.pdf; Letter from State Employees Association 

ofNorth Carolina to North Carolina Department ofHealth and Human Services (Aug. 1, 2022), 

https://www.seanc.org/assets/HCA-NC-CoN-Comment-FINAL.pdf. 

28 See, e.g., Erin E. Trish & Bradley J. Herring, How Do Health Insurer Market Concentration and 

Bargaining Power With Hospitals Affect Health Insurance Premiums?, 42 J. HEALTH ECON. 104 

(2015), http://www.sciencedirect.com/science/article/pii/SO 167 6296150003 75; https://hmpi.org/wpcontent/uploads/2017 /02/HMPI-Town-Phoebe-Putney.pdf; Robert Town, The Economists' Supreme 

Court Amicus Briefin the Phoebe Putney Hospital Acquisition Case, 1 HEALTH MGMT. PoL'Y & 

INNOVATION 60 (2012). These empirical findings hold for both for-profit and not-for-profit hospitals. In 

other words, non-profit hospitals can and do exercise market power and raise prices, similar to for-profit 

hospitals. 

29 See, e.g., U.S. DEPT. OF JUSTICE, Justice Department Comments on Settlement in Private "No-Poach" 

Class Action That Allows Government to Enforce Injunction Against Duke University (Nov. 8, 2019), 

https://www.justice.gov/opa/pr/justice-department-comments-settlement-private-no-poach-class-actionallows-govemment. 

Page 9 of9