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U.S. House Committee to investigate FTC regulation of vision insurance market

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The U.S. House of Representatives Oversight Committee announced it has launched an investigation into the Federal Trade Commission’s (FTC) oversight of the vision insurance market.

Let’s talk about this letter.

In the letter, issued on August 8, 2023, Kentucky Rep. James Comer, chair of the committee panel, called for the FTC to provide information for the panel to investigate the agency’s role in preventing unfair and unharmful marketplace practices—particularly pertaining to the consolidation of the vision insurance market and its impact on consumers.

Go on…

Comer set a deadline of August 15, 2023, for FTC Chair Lina Khan to schedule a briefing with the committee panel on the subject matter, citing that the panel has the broad authority to investigate “any matter at any time.”

So … why the request?

According to the letter, two companies alone are in control of 85% of the vision insurance plan market, “in 42 states, one company controls at least a plurality of the vision insurance market,” and, “in 28 states, a a single company controls more than 75% of the vision insurance plan market.”

Any specific companies mentioned?

Comer cited VSP Vision Care (VSP) as one such company that provides vision insurance for 82 million patients across the United States—two-thirds of U.S. enrollees with vision-only insurance plans.

Further, VSP was called out for providing “financial incentives to providers who push frames that VSP owns or has affiliations with without consumers’ knowledge.

Any others?

No other companies were mentioned by name.

However, the letter also mentioned that other vision insurers have sought to vertically consolidate by “creating their own brick-and-mortar retail stores providing favorable copays and pricing to steer consumers to their stores and away from their competitors.”

These insurers “own lens and frame manufacturers, enabling them to mark up prices by as much as 1,000%,” according to Comer.

And the intent of this letter?

The panel is seeking to ensure that such consolidation in the vision care market is not detrimentally impacting consumers, according to Comer.

Give me some background on this issue.

According to the American Optometric Association (AOA), similar probing into vision benefit managers (VBMs) has already been the focus of bipartisan legislation (in the U.S. House and Senate) that seeks to “crack down on anti-doctor and anti-patient policies.”

These efforts have already been backed by 24+ patient and consumer advocacy groups like the AOA and American Dental Association (ADA).

Talk about this legislation.

The Dental and Optometric Care (DOC) Access Act (H.R. 1385/S. 1424) seeks to forbid detrimental policies set by federally-regulated vision, dental, and health plans such as the Employee Retirement Income Security Act (ERISA).

By how, exactly?

The DOC Access Act seeks to prohibit plans from:

  • Limiting patients’ and doctors’ choice of labs
  • Price fixing for non-covered services and materials

To note, according to the AOA, the federal act would be “complementing state-level vision and dental plan laws enacted in 45 states” and is critically needed.

Case in point: an estimated one-third of U.S. patients are under a federally-regulated vision or dental plan.

What other legislation is out there?

Filed this year, the chronological list below includes scope of practice and “not-a-doctor” bills:

  • Nebraska: LB 216 (introduced Jan. 10, 2023)
  • Connecticut: Raised SB-899 (introduced Jan. 25, 2023)
  • California: AB-765 (introduced Feb. 13, 2023)
  • Massachusetts: Bill H.3606 (introduced March 9, 2023)
  • Texas: HB 2324 (introduced March 9, 2023)
  • Wisconsin: SB143 (introduced March 23, 2023)
  • North Carolina: H576 (filed April 5, 2023)
  • New Jersey: A-5445 (introduced May 15, 2023)
  • New Jersey: S3841 (introduced May 15, 2023)
  • New Hampshire SB200 (introduced May 18, 2023)

*Disclaimer: The information provided in this article does not and is not intended to constitute legal advice; instead, all information, content, materials available herein are for general information purposes only.