Federal Trade Commission staff warned Tennessee legislators on Apr. 2 of possible harm to patients if proposed legislation passes that would end the Certificate of Public Advantage (COPA) overseeing Ballad Health.
The FTC’s warning comes as state lawmakers consider bills that could affect healthcare competition and patient outcomes in Northeast Tennessee. The agency says the expiration of COPA without other competitive safeguards could lead to higher healthcare costs and lower quality of care for patients.
In a letter addressed to Tennessee Representative David Hawk, directors from the FTC’s Office of Policy Planning and Bureaus of Competition and Economics said, "repealing a COPA law or allowing a specific COPA to expire in the absence of competing healthcare systems enables a monopolist to exercise substantial market power unconstrained by state regulatory oversight or antitrust enforcement against merger-related harms." The letter noted that House Bill 2278 and Senate Bill 2414 would allow Ballad Health’s COPA to expire in June 2028, ending supervision by the Tennessee Department of Health over key aspects such as quality, access, and population health initiatives.
The FTC had previously opposed Ballad Health’s original COPA application during its formation in 2018. The agency reiterated concerns that when such agreements expire without new competition present, there is an increased risk for negative impacts on prices, service availability, and quality.
The same letter also addressed House Bill 819 and Senate Bill 1369 regarding removal of Certificate of Need (CON) requirements for acute care hospitals. These requirements currently mean providers must obtain state approval before expanding or establishing new facilities. According to the FTC letter, "removing unnecessary CON regulatory barriers... is consistent with recommendations in FTC staff’s prior advocacy." However, they expressed concern that these bills may not take effect until 2030—creating a two-year gap after COPA expires but before CON laws are repealed—which could undermine efforts to restore hospital competition lost after Ballad Health's merger.
The FTC encouraged lawmakers to align any repeal timing so new competition can enter as soon as possible after regulatory changes take place. The commission stated it continues working "to promote competition, and to protect and educate consumers."
