The Robinson-Patman Act:

The Antitrust Law That Forgot Healthcare

Imagine, for a moment, that you walk into a grocery store and the cashier charges you $15 for a carton of eggs, while the person in line behind you—wearing a slightly nicer watch—pays just $3 for the identical product. You'd be outraged, possibly litigious, and certainly never shop there again.

Yet this is precisely how American healthcare operates every single day. And why? Because everyone has conveniently decided to ignore a perfect law that's been gathering dust since 1936.

The Robinson-Patman Act exists to prevent price discrimination—the commercial equivalent of "we charge what we think you can pay."

It works splendidly in industries ranging from breakfast cereals to industrial lubricants. But in healthcare, it's treated with the same reverence as those "Do Not Remove" tags on mattresses.

The Behavioral Economics of Organized Extortion

What's fascinating about healthcare pricing isn't just that it's unfair. It's that it defies every principle of how markets should function. In a typical industry, scale brings efficiency. In healthcare, scale brings the privilege to extort even more money through legalized kickback schemes that would make a Prohibition-era gangster blush with admiration.

Take Group Purchasing Organizations. Their psychological trick is brilliant: They've convinced everyone they're reducing costs when they're actually inflating them. It's like hiring a "discount negotiator" who charges you a 30% fee to save you 20%—and then calling it a bargain.

The beauty of this racket is in its complexity. GPOs and PBMs have created a system so byzantine that even explaining how they steal your money requires PowerPoint presentations with at least 17 slides. This cognitive overhead is perfect camouflage—when something is sufficiently complicated, we assume it must be necessary.

The Delightful Contradiction of 340B

If Franz Kafka and Joseph Heller collaborated on designing a drug pricing program, they couldn't have created anything more gloriously absurd than 340B. Here's a program that allows certain hospitals to buy drugs at massive discounts, ostensibly to help poor patients, but doesn't require them to pass those savings along to anyone.

It's rather like giving a charity a 90% discount on soup ingredients to feed the homeless, then allowing them to sell that soup at full price to wealthy tourists while keeping the difference. As business models go, it's magnificent in its audacity.

The Asymmetric Information Arms Race

What we're witnessing in healthcare is a textbook example of what economists call "information asymmetry" combined with what I call "complexity arbitrage." The system profits from ensuring you never understand how much anything should cost.

Hospital chargemasters—those mythical pricing documents that determine what you're billed—are maintained with the secrecy generally reserved for nuclear launch codes. And for a good reason: if people understood the markups involved (4,000% on a bag of saline, anyone?), there would be pitchforks and torches at hospital administrative offices.

The Power of Default Settings

Regulatory inertia is the behavioral quirk that keeps this whole system running. The FTC has the legal authority to enforce Robinson-Patman in healthcare tomorrow morning, but it chooses not to because the default setting is "don't rock the boat."

This is the same psychological principle that keeps people in lousy mobile phone contracts or bad relationships. Changing requires effort and confrontation while maintaining the status quo requires passive acceptance.

A Modest Proposal for Total System Disruption

What would happen if we flipped the default switch and decided that this perfect antitrust law applies to healthcare? Chaos, disruption, and—eventually—something resembling an actual market.

Independent physicians could suddenly purchase drugs and devices at the same prices as hospital megaliths. GPOs and PBMs would have to justify their existence based on actual value rather than financial sleight-of-hand. And patients might—dare I say it—understand what healthcare costs are before receiving a bill that requires mortgage-level financing.

The Psychological Barrier to Reform

The greatest trick the healthcare cartel ever pulled was convincing America that this system was somehow inevitable or necessary. It's a masterclass in what behavioral economists call "anchoring bias." By establishing an expectation that healthcare is inherently complex and expensive, any alternative seems implausible.

But here's the delicious irony: fixing this requires no new legislation, congressional battles, or presidential initiatives. It simply requires enforcing a law that's been in place since Franklin Roosevelt was president.

As a behavioral scientist might put it, the solution exists; what's missing is merely the decision to implement it.

So the next time your local hospital charges you $75 for a Tylenol while the CEO enjoys his third vacation home, remember: this isn't just expensive healthcare—it's expensive healthcare that's flagrantly illegal under existing antitrust law. We've just collectively decided to ignore that inconvenient detail.

And that, my friends, is the greatest pricing scam in American history.

Rojas out.