Justice Stewart’s 1966 dictum about the inevitability of government success in challenging mergers under Section 7 of the Clayton Act held true for another fifteen years or so. In the early 1980s, however, federal enforcement agencies, the Department of Justice (DOJ) and the Federal Trade Commission (FTC), began to find the federal courts less hospitable to antitrust merger cases as more sophisticated economic inquiries and changing proof burdens complicated the task of identifying anticompetitive mergers. Indeed, since the early 1980s, the government has lost more litigated merger cases than it has won and has come under criticism from some quarters for becoming gun shy and not adequately policing the wave of consolidations that have occurred over the past decade.

Hospital mergers, however, are a different story. Until two years ago, the government rode a streak of important victories in federal courts and FTC administrative proceedings, and had obtained consent decrees from scores of hospitals that had announced plans to merge.

The pressures encountered by hospitals in the current era of reimbursement declines and stiffened competition are well known. As the “ultimate” payors—primarily employers and government—aggressively continue to seek low cost care, the response of the hospital industry has been to move toward consolidation and efficiency-enhancing mechanisms.

Increasingly, nonprofit, tax-exempt hospitals have come to believe that they are at a significant disadvantage vis-á-vis their for-profit brethren in their ability to attract the capital needed to compete in the market. A growing trend among nonprofit hospitals, therefore, is to sell to or enter into a joint venture with a proprietary organization, or alternatively to convert to for-profit status. In 1995, fifty-eight nonprofit hospitals became for-profit; hospital conversions to for-profit status in 1996 are projected to outstrip the pace established the prior year.

The conversion trend has not gone unnoticed at the state level. Recently, several states have proposed or enacted laws regulating sales and conversions of nonprofit hospitals, and many more states are contemplating such legislation.

In the words of its sponsor, Senator Jacob Javits, the Employee Retirement Income Security Act (ERISA) was enacted in 1974 “to maintain the voluntary growth of private [pension and employee benefit] plans while at the same time making needed structural reforms in such areas as vesting, funding, termination, etc. so as to safeguard workers against loss of their earned or anticipated benefits....” Ironically, one of ERISA’s provisions—its indeterminate provision for the preemption of state law—has probably created more uncertainty about the adequacy and security of health care benefits than any other piece of legislation. Neither ERISA nor any other federal statute comprehensively regulates the content of employer provided health care plans, including benefits provided through managed care organizations (MCOs).

In the United Kingdom, how does the National Health Service (NHS or the Service) respond to the pressures imposed on it by patients, doctors and the government? What techniques for distributing resources have been adopted for managing these pressures? Part I of this Article explains the administrative evolution of the NHS. Part II discusses the legal framework surrounding the allocation of resources throughout the different tiers of the NHS: (1) from the Secretary of State for Health to health authorities, (2) from health authorities to hospitals and general practitioners (GPs), and (3) from doctors to patients. Part III comments on the case for a standing committee to advise the government on matters of resource allocation within the NHS. It also considers the legal, political, and managerial contributions to the debate and, in particular, comments on the future of the traditional notion of clinical freedom.

Section A describes the culture that developed within the NHS, Section B discusses the pressure for reform that developed during the 1980s, and Section C reviews the system of the “internal market” for health that was introduced in 1990.

What proportion of health care resources should go to programs likely to benefit older citizens, such as treatments for Alzheimer’s disease and hip replacements, and what share should be given to programs likely to benefit the young, such as prenatal and neonatal care? What portion should go to rare but severe diseases that plague the few, or to common, easily correctable illnesses that afflict the many? What percentage of funds should go to research, rehabilitation or to intensive care? Many nations have made such hard choices about how to use their limited funds for health care by explicitly setting priorities based on their social commitments. In the United States, however, allocation of health care resources has largely been left to personal choice and market forces. Although the United States spends around 14% of its gross national product (GNP) on health care, the United States and South Africa are the only two industrialized countries that fail to provide citizens with universal access.

In December 1995, the Eighth Circuit decided Kennedy v. Schafer, holding that a teenage patient who committed suicide while under treatment at a state psychiatric facility had a constitutionally protected liberty interest in a safe and humane environment under the Due Process Clause of the Fourteenth Amendment if her status changed from voluntary to involuntary during the course of her admission. The fifteen year old patient, Kathleen Kennedy, had been identified as a suicide risk, and had been placed on “Protective Suicide Precautions,” which required a designated staff member to keep her in constant eyesight and to interact with her at fifteen to twenty minute intervals. Despite these stringent requirements for supervision and contact, Kathleen was found dead in her room more than two hours after her last contact with a staff member. Her parents brought suit under 42 U.S.C. § 1983 against state and hospital officials, alleging that chronic understaffing and falsification of the records used to determine staffing levels amounted to a pattern of deliberate indifference to patient safety which violated their daughter’s protected liberty interest in a safe and humane environment.

Genotechnology (genotech) is the subset of biotechnology (biotech) dealing with human genetics. Even as a subset, however, genotechnology has a significant effect within the U.S. economy. This impact is partly attributable to the federal government’s efforts to nurture the industry. Although these efforts have contributed to the American genotech industry’s rapid growth, the federal government has not kept pace in the legal and regulatory areas necessary to ensure that genotech drugs are marketed responsibly. In fact, current federal policy has been characterized as “grossly short-sighted.”

The Food and Drug Administration (FDA) presently has approved more than thirty genotech drugs for general use. Over 450 more products are currently under development, with at least 120 of those in final testing awaiting FDA approval. Cancer treatment products comprise the largest segment with 114 drugs either under development, pending approval, or finally approved for sale.

As sales figures indicate, genotech drugs have already firmly entrenched themselves in the marketplace.