Markets Wired

Federal Trade Commission staff has submitted comments to Frank W. Berry, Commissioner of the Georgia Department of Community Health, supporting a Certificate of Need (CON) application filed by Lee County Medical Center.

State CON requirements typically require healthcare providers to obtain state approval before expanding, establishing new facilities or services, or making certain large capital expenditures. Lee County Medical Center is seeking the state’s approval to build a general hospital in Lee County, whose residents now have to travel across county lines for hospital services.

The comments, submitted by staff of the FTC’s Office of Policy Planning, Bureau of Competition and Bureau of Economics in response to a request by the Board of Commissioners of Lee County, Georgia, recommend that the Department grant the CON request in order to foster hospital competition in a region where competition is lacking.

The comment states that competition spurs innovation, lower prices, and higher quality goods and services for consumers, including health care consumers. “Empirical evidence on competition in health care markets . . . shows that health care consumers benefit from lower prices and higher quality when health care provider markets are more competitive,” the comment states. It explains that, based on the FTC’s prior examination of competitive conditions in Lee, Dougherty, Mitchell, Terrell, Worth and Baker counties, the FTC is concerned about the lack of hospital competition in that region, where one entity is the dominant provider of hospital services. The comment notes that “[i]f the Department approves the CON, consumers in and around Lee County (and third-party payors) may benefit from greater choice, higher quality, and lower prices spurred by competition.”

The Commission vote to issue the comment was 2-0. (FTC File No. V180000; the staff contact is Daniel J. Gilman, Office of Policy Planning, 202-326-3136.)

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