Out of Control Policy Blog

The anti-competition lobby

If someone does something better than you, you're supposed to work hard at whipping yourself into shape and improving, or you and your business go kaput.

Increasingly, it's becoming more popular for those who benefit from the status quo to simply lobby their political buddies to squash emerging competitors. We see it all the time, and now we see it with specialty hospitals:

Specialty hospitals are typically smaller than traditional general hospitals and focus on a few specific areas of care such as orthopedic surgery or heart care. They typically offer a higher level of care than general hospitals because specialization allows them to be more effective and efficient. Specialty hospitals typically have more nurses per patient, lower infection rates, less bureaucracy, and lower costs.

But specialty hospitals are not universally welcomed in the industry. Their competitors--the bigger, more established general hospitals-- claim specialty hospitals are "stealing" patients--and revenue--from them.

In most industries, companies facing competition are expected to improve their service, lower their costs, or go out of business.

Instead, general hospitals lobbied Congress to include in the recently passed Medicare reform bill an 18-month ban on the construction of new specialty hospitals. They are now lobbying to make the ban permanent.

Ted Balaker is Producer


« D.C. caves to M.L.B. | Main | SpaceShipOneís not the only one »




Out of Control Policy Archives