The Trump administration has significantly escalated its antitrust enforcement against the nation’s largest hospital systems, launching a series of high-profile lawsuits and federal initiatives aimed at dismantling contracting practices it alleges drive up healthcare costs for millions of Americans.
In a swift succession of legal actions, the U.S. Department of Justice (DOJ) has sued two major regional health giants, New York-Presbyterian and OhioHealth, while the Federal Trade Commission (FTC) has established a new “Healthcare Task Force” to coordinate a multi-front war on anticompetitive conduct.
The latest salvo came last week when the Justice Department’s Antitrust Division, alongside the U.S. Attorney’s Office for the Southern District of New York, filed a civil antitrust lawsuit against the New York-Presbyterian hospital system, the largest and most powerful provider in New York City.
Federal officials allege the nonprofit system used its market leverage to force insurers into contracts that insulated the hospital from price competition.
“Millions of New Yorkers pay more for healthcare because of these anticompetitive practices,” Attorney General Pam Bondi said in a statement announcing the litigation. “At the direction of President Trump, this Justice Department will fight relentlessly to ensure that Americans get the healthcare they need without facing exorbitant costs.”
According to the DOJ complaint, New York-Presbyterian used its market power to impose “anti-steering” and “all-or-nothing” requirements. These terms reportedly blocked insurers from offering incentives to patients who sought out lower-priced rival hospitals and forced them to place New York-Presbyterian facilities in their “most favored” tier.
Acting Assistant Attorney General Omeed A. Assefi of the Antitrust Division accused the hospital system of deliberately stifling innovation. “New York-Presbyterian has known for years that the American consumer wants budget-conscious health plans that reduce healthcare costs,” Assefi stated. “But rather than offer consumers choice, New York-Presbyterian uses its market power to protect its margins, impede competition from rival hospitals, and prevent employers and unions from creating these plans.”
The New York lawsuit followed a similar action in February against OhioHealth, the largest healthcare system in central Ohio. Federal prosecutors allege OhioHealth used its dominance to prevent insurers from offering money-saving plan features to residents in the Columbus area.
“Competition for healthcare is vital to all Americans,” Assefi said regarding the OhioHealth case. “These restrictions cause many Columbus residents to pay more for lower-quality healthcare. American families and consumers deserve better.”
FTC Launches New Healthcare Task Force
Parallel to the DOJ’s litigation, the FTC is moving to institutionalize its scrutiny of the sector. On March 20, FTC Chairman Andrew N. Ferguson issued a directive to form a Healthcare Task Force across five bureaus to provide a “coordinated, integrated approach” to enforcement.
In a memorandum obtained by reporters, Ferguson noted that the industry constitutes 18% of the U.S. Gross Domestic Product (GDP), yet many Americans remain unable to afford care due to market distortions.
“Consolidation and anticompetitive conduct have distorted the economic landscape in many healthcare markets,” Ferguson wrote. “The results are disturbing: higher prices, decreased quality, less access and transparency, and stifled innovation.”
Ferguson highlighted several recent “wins” by the agency, including a landmark settlement with pharmacy benefit manager Express Scripts expected to save patients up to $7 billion in insulin costs over a decade. He also cited the successful blocking of mergers between medical device manufacturers Alcon and Lensar, as well as Edwards and JenaValve.
“We must remain vigilant in policing unlawful business practices in the healthcare space,” Ferguson stated, adding that the task force will seek to expand its membership to include the Department of Health and Human Services (HHS) to “make our economy great again for all American patients, healthcare workers, and taxpayers.”
Industry Pushback and Economic Stakes
The hospital industry has begun to defend its practices, arguing that the federal government is mischaracterizing the market dynamics. In a statement, New York-Presbyterian called the DOJ lawsuit “without merit” and argued that insurance companies, not hospitals, hold the true market power.
“We do not seek to exclude any other hospital from any insurer’s network,” the system stated. “We seek to maximize access to the highest quality of care. Insurance companies hold the market power and use it to restrict patient choice.”
However, the federal crackdown comes as policymakers face mounting pressure over healthcare affordability ahead of the midterm elections. Research suggests that hospital markets are heavily consolidated, with 97% of metro areas possessing concentrated markets for inpatient care.
Legal experts say the current wave of litigation represents a “significant escalation.” U.S. Attorney Jay Clayton for the Southern District of New York warned that more investigations are likely. “The high cost of healthcare is frustrating to every New Yorker,” Clayton said. “Our Office will continue to work with our partners in the Antitrust Division to investigate and confront anticompetitive practices.”
The Justice Department is currently seeking court orders to permanently enjoin these hospital systems from imposing restrictive contract terms. While the ultimate impact on consumer pricing remains difficult to quantify, industry analysts note that excluding expensive systems from certain health plans can lower costs for employers and consumers by more than 10%.