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Department of Justice Statement on the Closing of the
Vermont Home Health Investigation

WASHINGTON, D.C. - The Department's Antitrust Division issued the following statement today after the Department announced the closing of its investigation of an alleged territorial allocation among Vermont's 12 Medicare-certified home health agencies:

As a result of a new state law, the Home Health Services Act of 2005, the Department has decided not to proceed with its investigation. “The Department believes that competition motivates providers to improve quality to attract customers and referral sources, invest in new technology, and train qualified staff. Our investigation demonstrated that competition has delivered these benefits to customers of home health agencies where state governments have not intervened with the market, as Vermont has done here. Moreover, while it is the Division's position that a state law such as this one cannot retroactively immunize illegal conduct, the Department is not further pursuing the preexisting territorial allocations among the Vermont home health agencies because Vermont's new legislation provides some state government oversight of the home health agencies, authorizes redrawing the territories to allow for additional competition and creates mechanisms for the state to supervise the agencies.”

Given that Vermont has chosen to pursue this regulatory approach, the Department is urging Vermont's state officials to exercise close oversight under the Act and to critically evaluate the agencies' arguments for maintaining the status quo and keeping out competition. The Division also is urging state officials to examine the objective measures of performance - such as client outcomes and reliability of service - and to consider how competitive incentives can be undermined by increased regulation. Finally, the Division is urging the state to take steps to foster competition among providers in contracting for the private delivery of home health services.