On August 15, 2022, the Federal Trade Commission (FTC) released the FTC Policy Perspectives and Certificates of Public Advantage staff policy paper, along with a fact sheet.
A Certificate of Public Advantage (COPA) law is passed by a state with the intent of displacing competition in the health care provider market.
A COPA is an approval by a state department, acting under the authority of the law passed by the state legislature, that allows health care providers to combine, subject to certain conditions, and provides active state supervision of the combination. If the combined parties fail to meet the obligations of the COPA, the state can remove the COPA protection that shields the combination from federal antitrust scrutiny. One rationale for a state enacting a COPA law is that the state may be in a better position to evaluate the health care needs of its population, and to implement safeguards through a COPA to protect those needs, even if competition is displaced by the conduct.
Not surprisingly, the FTC has been a staunch opponent of such laws, and the policy paper and fact sheet are consistent with that opposition. Indeed, both the policy paper and fact sheet encourage states to “avoid using COPAs.” The policy paper also urges “states that have existing COPA laws to consider repealing those laws if they do not have an active COPA in place.” The FTC’s reluctance to encourage the repeal of a COPA law where an active COPA is in place suggests that, in fact, the FTC does see some protections associated with active COPAs.