Washington, DC - The Department of Justice announced that it will not challenge a proposal by the American Optometric Association (the Association) to expand its group purchasing organization’s (GPO) activities to include the purchase of optometric products for resale to consumers, namely corrective eyeglass lenses, eyeglass frames, and contact lenses. The department said that the proposed expansion is unlikely to produce anticompetitive effects. Moreover, the expansion could produce discounts for the Association’s members and ultimately lead to lower prices for optometric products for consumers.
The department’s position was stated in a business review letter to counsel for the Association and the GPO from Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.
Many joint purchasing arrangements among healthcare providers do not raise antitrust concerns where these arrangements can produce efficiencies that benefit consumers, including reducing transaction costs. A healthcare joint purchasing arrangement, however, can raise antitrust concerns if the arrangement drives down the price of a product or service being purchased below competitive levels or if the arrangement facilitates price fixing or other anticompetitive conduct. Certain safeguards, however, can reduce the risk of a joint purchasing arrangement facilitating price fixing or other anticompetitive conduct.
According to representations made by the Association and the GPO, the Association will follow the three safeguards discussed in Statement 7 of the Statements of Antitrust Enforcement Policy in Health Care to reduce the risk of facilitating price fixing. Those safeguards are that (1) GPO participants will not be required to make any of their optometric-product purchases through the GPO, (2) a third party will negotiate prices with the GPO’s suppliers, and (3) communications between the GPO and each individual participant regarding prices will be kept confidential from other GPO participants. In addition, no optometric product manufacturer maintains any financial stake, makes any financial contributions, or holds any ownership or board positions in the Association or the GPO.
Based on the information submitted and representations made by the Association and the GPO, the department has no present intention to challenge the expansion of the Association’s GPO to include the purchase of optometric products for resale to consumers.
Under the department’s business review procedure, an organization may submit a proposed action to the Antitrust Division and receive a statement as to whether the Division currently intends to challenge the action under the antitrust laws based on the information provided. The department reserves the right to challenge the proposed action under the antitrust laws if the actual operation of the proposed conduct proves to be anticompetitive in purpose or effect.