The Medical Device Manufacturers Association (MDMA) recently asked Congress to eliminate allegedly anticompetitive practices in the hospital supply industry. Mark Leahey, MDMA executive director, urged the Senate Judiciary Antitrust Subcommittee to protect patients from exclusionary practices used by some large hospital group purchasing organizations (GPO). His testimony focused on the effectiveness of self-policing codes of conduct implemented by the GPO industry. Evidence presented by the MDMA indicated that measures meant to avoid anticompetitive practices have had little effect on stopping them.

“GPOs continue to bundle unrelated products and companies, execute long-term and sole-source contracts, award no-bid contracts, collect excessive fees, and police the markets for select dominant companies in a way that excludes innovative, cost-effective technologies,” says Leahey. “As a result, patients, caregivers and taxpayers still suffer from the anticompetitive and exclusionary practices of GPOs.”

GPOs currently operate under a legal “safe harbor” exemption from the antikickback provisions of the Social Security Act. MDMA has lobbied for years for legislation to prevent these practices.

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