Pros: By scrutinizing proposed mergers and challenging those clearly poised to increase prices, federal and state regulators can protect hospital markets from becoming even more consolidated.

Cons: This strategy only prevents the situation from worsening and can be difficult to execute because regulators have limited resources and the burden of proof is high. It can also be risky since an adverse ruling can set a precedent that stymies future cases. Additionally, not all mergers are required to be reported to federal antitrust authorities before they occur. Although deals can be retroactively challenged, competition may be affected before cases are resolved.

Pros: Even when consolidation has already occurred, state and federal officials can promote competition by preventing hospitals from engaging in anti-competitive business practices, such as using contracts with insurers to limit patients’ choices and increase costs.

Cons: This strategy, while important, faces many of the same constraints as litigation to block mergers. It is also somewhat unknown just how much of a direct impact these practices have on prices. In the case of nonprofit hospitals, the Federal Trade Commission is prohibited from addressing any anti-competitive practices, although state regulators and the Department of Justice can pursue these cases.

Pros: Highly consolidated hospital markets leave few options other than the regulation of prices through mechanisms like price caps or rate-setting. Requiring hospitals to cap payment rates or accept a set price would protect consumers from exorbitant bills and could lead to lower prices, depending on the rate defined by regulators.

Cons: Many states have attempted regulation of hospital prices but have had little success thus far. Not only is this strategy politically challenging, it is also logistically challenging for regulators who must determine the correct rate to pay hospitals for each individual service. Setting the incorrect rate can lead to unintended consequences, including constrained access to care and poorer quality of care.