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House Asks FTC to Study State Laws Restricting PPOs
House Asks FTC to Study State Laws Restricting PPOs State laws that "restrict" the establishment of preferred provider organizations will be studied by the Federal Trade Commission, under a resolution passed August 1, 1984, by the House Energy and Commerce Committee. The resolution requests the FTC to study" state laws and regulations and proposals for the state laws and regulations which may prevent, limit, or otherwise restrict. . . the formation, development, or operation of preferred provider organizations" or other similar kinds of health care provider organizations. Conversely, those state laws that "may authorize or facilitate" the formation of PPOs will be examined as well, according to the resolution. Explaining the need for such a study, Commerce subcommittee chairman James J. Florio (D-NJ) commented that "although PPOs may be potentially valuable to cost containment, the goals of public policy toward them are inhibited by lack of information." The FTC study, he said, will help "fill this information gap." Rep. Norman F. Lent (R-NY) observed that "several states currently have statutes in effect that prohibit discrimination by insurers between beneficiaries in terms of fees charged or benefits received which may inhibit the development of PPOs." Under House of Representatives procedure, the resolution went directly to FTC, without the necessity for full House consideration. FTC, according to a committee staffer, "expressed interest in doing the study." The resolution directs the FTC to survey state laws and regulations that "protect the public interest" in the operation of PPOs and to survey the published literature and any other "publicly available information" for evidence of health care cost savings associated with PPOs. Specifically, the committee re-
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Florio: 'Information gap'
Lent: Prohibit discrimination
quests FTC to determine whether "total health care expenditures for the enrolled populations are reduced; provider service utilization is reduced;" and "any cost savings are offset by increased costs for the nonenrolled population." Evidence of consumer satisfaction or problems in "access to or quality
of health care services provided through PPOs" is also requested. In addition, FTC is asked to investigate "the means used to induce provider participation" in PPOs and the effect, "if any, of such programs and arrangements on the patterns, organization, and location of the providers' provision of services."
FTC Drops Proposed Rule On Warnings in Antacid Ads The Federal Trade Commission has voted to terminate a rulemaking procedure, begun eight years ago, that would have required that ads for antacid products containing a stipulated level of sodium state that such products might not be safe for persons on sodium-restricted diets. Other antacids would have had to carry a warning that they might not be safe for all people, and would have urged consumers to read the labels. But according to the now-public FTC staff report, "the rule would produce high costs with virtually no consumer benefit." FTC Bureau of Economics Director Wendy Gramm commented that "from the available
evidence, one cannot reasonably infer that the proposed rule · would benefit consumers." This is because, according to the report, "the evidence is inadequate to conclude that such disclosures would be effective or would change usage patterns." Concerning earlier FTC assertions that the ads for antacids are patently deceptive, FTC bureau official William Synder said he could not" conclude that the antacid advertisements in the record contain deceptive implied claims that the products are safe for everyone." He said that the public does not misperceive antacids as harmless.
American Pharmacy Vol. NS24, No. 11 , November 1984/712
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Florio: 'Information gap'
Lent: Prohibit discrimination
quests FTC to determine whether "total health care expenditures for the enrolled populations are reduced; provider service utilization is reduced;" and "any cost savings are offset by increased costs for the nonenrolled population." Evidence of consumer satisfaction or problems in "access to or quality
of health care services provided through PPOs" is also requested. In addition, FTC is asked to investigate "the means used to induce provider participation" in PPOs and the effect, "if any, of such programs and arrangements on the patterns, organization, and location of the providers' provision of services."
FTC Drops Proposed Rule On Warnings in Antacid Ads The Federal Trade Commission has voted to terminate a rulemaking procedure, begun eight years ago, that would have required that ads for antacid products containing a stipulated level of sodium state that such products might not be safe for persons on sodium-restricted diets. Other antacids would have had to carry a warning that they might not be safe for all people, and would have urged consumers to read the labels. But according to the now-public FTC staff report, "the rule would produce high costs with virtually no consumer benefit." FTC Bureau of Economics Director Wendy Gramm commented that "from the available
evidence, one cannot reasonably infer that the proposed rule · would benefit consumers." This is because, according to the report, "the evidence is inadequate to conclude that such disclosures would be effective or would change usage patterns." Concerning earlier FTC assertions that the ads for antacids are patently deceptive, FTC bureau official William Synder said he could not" conclude that the antacid advertisements in the record contain deceptive implied claims that the products are safe for everyone." He said that the public does not misperceive antacids as harmless.
American Pharmacy Vol. NS24, No. 11 , November 1984/712