Enhancing Beneficial Competition in the Health Professions 2004 The OECD Competition Committee debated Enhancing Beneficial Competition in the Health Professions in October 2004. This document includes an executive summary and the documents from the meeting: an analytical note by Mr. Sean Ennis of the OECD, written submissions from Denmark, the European Commission, Germany, Hungary, Ireland, Italy, Japan, Korea, Mexico, the Netherlands, Norway, Switzerland, Turkey, and the United States, as well as an aide-memoire of the discussion. Restrictions on entry into the health professions serve the important purpose of protecting consumers from unqualified health care practitioners. However, sometimes the restrictions go too far. The limits on entry to a profession govern the qualifications and skills of practitioners as well as, occasionally, the quantity and geographic locations of practices. These limits may be excessive, overly restricting competition and raising healthcare costs. Para-professionals and alternative professionals are often unduly restricted in both the types of work that they can perform and in their freedom to operate in an autonomous or semi-autonomous environment. Sometimes these restrictions are created by the professionals with whom the paraprofessionals would partially compete. Health related products, such as eyeglasses, contact lenses, hearing aids, non-prescription drugs and dentures, are sometimes made unavailable unless consumers have first undergone tests that are not directly related to the provision of the product or unless they purchase products from specific suppliers. Professional associations often introduce rules that govern the commercial behaviour of members but do not protect consumers. Rather, such restrictions raise prices to consumers and increase profits for providers. Health professional associations often seek to co-ordinate or suggest fees for their members. Such coordination typically has the effect of raising prices rather than protecting consumers from price abuses. OECD Guiding Principles for Regulatory Quality and Performance (2005) Competition in the Pharmaceutical Industry (2000) Competition in Professional Services (1999) For Official Use DAF/COMP(2005)45 Organisation de Coopération et de Développement Economiques Organisation for Economic Co-operation and Development 16-Dec-2005 ___________________________________________________________________________________________ English/French DIRECTORATE FOR FINANCIAL AND ENTERPRISE AFFAIRS COMPETITION COMMITTEE For Official Use DAF/COMP(2005)45 ENHANCING BENEFICIAL COMPETITION IN THE HEALTH PROFESSIONS English/French JT00196126 Document complet disponible sur OLIS dans son format d'origine Complete document available on OLIS in its original format DAF/COMP(2005)45 FOREWORD This document comprises proceedings in the original languages of a Roundtable on Competition in the Health Sector: Enhancing Beneficial Competition in the Health Professions, which was held by Working Party N°2 of the Competition Committee in October 2004. It is published under the responsibility of the Secretary General of the OECD to bring information on this topic to the attention of a wider audience. This compilation is one of a series of publications entitled “Competition Policy Roundtables”. PRÉFACE Ce document rassemble la documentation dans la langue d’origine dans laquelle elle a été soumise, relative à une table ronde sur la Concurrence et Réglementation dans le Secteur de la Santé: Les professions de santé et la concurrence qui s’est tenue en octobre 2004 dans le cadre du Groupe de Travail N°2 du Comité de la Concurrence. Il est publié sous la responsabilité du Secrétaire général de l’OCDE, afin de porter à la connaissance d’un large public les éléments d’information qui ont été réunis à cette occasion. Cette compilation fait partie de la série intitulée « Les tables rondes sur la politique de la concurrence ». Visit our Internet Site – Consultez notre site Internet http://www.oecd.org/competition 3 DAF/COMP(2005)45 OTHER TITLES SERIES ROUNDTABLES ON COMPETITION POLICY 1. Competition Policy and Environment OCDE/GD(96)22 2. Failing Firm Defence OCDE/GD(96)23 3. Competition Policy and Film Distribution OCDE/GD(96)60 4. Competition Policy and Efficiency Claims in Horizontal Agreements OCDE/GD(96)65 5. The Essential Facilities Concept OCDE/GD(96)113 6. Competition in Telecommunications OCDE/GD(96)114 7. The Reform of International Satellite Organisations OCDE/GD(96)123 8. Abuse of Dominance and Monopolisation OCDE/GD(96)131 9. Application of Competition Policy to High Tech Markets OCDE/GD(97)44 10. General Cartel Bans: Criteria for Exemption for Small and Medium-sized Enterprises OCDE/GD(97)53 11. Competition Issues related to Sports OCDE/GD(97)128 12. Application of Competition Policy to the Electricity Sector OCDE/GD(97)132 13. Judicial Enforcement of Competition Law OCDE/GD(97)200 14. Resale Price Maintenance OCDE/GD(97)229 15. Railways: Structure, Regulation and Competition Policy DAFFE/CLP(98)1 16. Competition Policy and International Airport Services DAFFE/CLP(98)3 17. Enhancing the Role of Competition in the Regulation of Banks DAFFE/CLP(98)16 18. Competition Policy and Intellectual Property Rights DAFFE/CLP(98)18 19. Competition and Related Regulation Issues in the Insurance Industry DAFFE/CLP(98)20 20. Competition Policy and Procurement Markets DAFFE/CLP(99)3 21. Regulation and Competition Issues in Broadcasting in the light of Convergence DAFFE/CLP(99)1 4 DAF/COMP(2005)45 22. Relationship between Regulators and Competition Authorities DAFFE/CLP(99)8 23. Buying Power of Multiproduct Retailers DAFFE/CLP(99)21 24. Promoting Competition in Postal Services DAFFE/CLP(99)22 25. Oligopoly DAFFE/CLP(99)25 26. Airline Mergers and Alliances DAFFE/CLP(2000)1 27. Competition in Professional Services DAFFE/CLP(2000)2 28. Competition in Local Services DAFFE/CLP(2000)13 29. Mergers in Financial Services DAFFE/CLP(2000)17 30. Promoting Competition in the Natural Gas Industry DAFFE/CLP(2000)18 31. Competition Issues in Electronic Commerce DAFFE/CLP(2000)32 32. Competition and Regulation Issues in the Pharmaceutical Industry DAFFE/CLP(2000)29 33. Competition Issues in Joint Ventures DAFFE/CLP(2000)33 34. Competition Issues in Road Transport DAFFE/CLP(2001)10 35. Price Transparency DAFFE/CLP(2001)22 36. Competition Policy in Subsidies and State Aid DAFFE/CLP(2001)24 37. Portfolio Effects in Conglomerate Mergers DAFFE/COMP(2002)5 38. Competition and Regulation Issues in Telecommunications DAFFE/COMP(2002)6 39. Merger Review in Emerging High Innovation Markets DAFFE/COMP(2002)20 40. Loyalty and Fidelity Discounts and Rebates DAFFE/COMP(2002)21 41. Communication by Competition Authorities DAFFE/COMP(2003)4 42. Substantive Criteria used for the Assessment of Mergers DAFFE/COMP(2003)5 43. Competition Issues in the Electricity Sector DAFFE/COMP(2003)14 44. Media Mergers DAFFE/COMP(2003)16 45. Non Commercial Services Obligations and Liberalisation DAFFE/COMP(2004)19 46. Competition and Regulation in the Water Sector DAFFE/COMP(2004)20 5 DAF/COMP(2005)45 47. Regulating Market Activities by Public Sector DAFFE/COMP(2004)36 48. Merger Remedies DAF/COMP(2004)21 49. Cartels: Sanctions against Individuals DAF/COMP(2004)39 50. Intellectual Property Rights DAF/COMP(2004)24 51. Predatory Foreclosure DAF/COMP(2005)14 52. Monopsony Buying and Joint Selling in Agriculture DAF/COMP(2005)44 6 DAF/COMP(2005)45 TABLE OF CONTENTS EXECUTIVE SUMMARY 9 SYNTHÈSE 15 BACKGROUND NOTE 21 NOTE DE RÉFÉRENCE 65 NATIONAL CONTRIBUTIONS DENMARK 115 GERMANY 121 HUNGARY 127 IRELAND 137 ITALY 151 JAPAN 159 KOREA 167 MEXICO 173 NETHERLANDS 185 NORWAY 195 SWITZERLAND 203 TURKEY 209 UNITED STATES 217 EUROPEAN COMMISSION 239 SUMMARY OF THE DISCUSSION 243 RESUME DES DEBATS 257 7 DAF/COMP(2005)45 EXECUTIVE SUMMARY In light of the written submissions, the background note and the oral discussion, the following points emerge: Health Care Professions and Competition (1) Restrictions on entry into the health professions serve an important purpose of protecting consumers from unqualified health care practitioners. However, at times the actual restrictions go too far. The need to protect consumers from charlatans has led to professional licensure in the health care professions, often endorsed in varying degrees by the government. The restrictions inherent in obtaining and maintaining professional licensure both serve as a means of ensuring quality of care and, at the same time, as a limit on competition. Evaluating the impact of apparently anti-competitive behavior in the health professions thus requires careful balancing: the existence of health professions and professional associations serves many beneficial purposes for patients. Nonetheless, at times the actions of health care practitioners, professional associations and even government regulations have effects that appear to be less related to enhancing quality for consumers than with ensuring high reimbursement for practitioners or limited choice for consumers. Policy makers can change regulations and take enforcement actions to eliminate restrictions whose primary purpose appears to be anti-competitive. Such changes can generate substantial reductions in spending on care without substantial reductions in quality of care. As health care spending continues to be a major source of private and public spending among OECD Members, there is an increasing drive towards increasing the efficiency of health care delivery, to ensure that a nation’s health care spending