The Corner Newsletter: Break Up Big Medicine Act & A New Report Calling for No AI Bailouts
Welcome to The Corner. In this issue, we explore Sen. Klobuchar’s bill to bolster the Tunney Act following a series of weak antitrust settlements that were driven by President Trump’s cozy relationships with corporations.
Warren-Hawley Bill to Rebuild Medical Markets Shows How Congress Can Wield Break-Up Power
Tara Pincock
Earlier this year, Senators Elizabeth Warren (D-MA) and Josh Hawley (R-MO) introduced The Break Up Big Medicine Act, which would ban “vertical integration” by healthcare corporations. The bill is based on the idea that breaking up conglomerates that combine everything from insurance companies to hospitals to pharmacies to prescription drug wholesalers would help lower healthcare prices and greater choice for patients.
Current healthcare costs are out of reach for the average American family. In 2025, premiums for an employer-sponsored family insurance plan cost $27,000 on average, up by $20,000 from premiums in 2001. And that’s just for employer-sponsored plans. After Republicans refused to extend subsidies for the Affordable Care Act, premiums more than doubled for subsidized enrollees, leading to a decline of 1.2 million people purchasing insurance from the open market.
The U.S. currently spends a total of $5.28 trillion per year, or nearly 20% of GDP on health care, much of which is considered subpar. Meanwhile, healthcare corporations and their investors are among the nation’s most profitable, securing four of the top 10 spots in the Fortune 500 in 2024, thanks to a combined revenue of $1.5 trillion dollars that year. Yale School of Medicine found that publicly traded healthcare companies paid out 95% of their net income to shareholders between 2005 and 2025.
The bill would divide the healthcare world in half. On one side are pharmacies, medical providers, and companies that manage the providers. The other side includes insurance companies, pharmacy benefit managers (PBMs), prescription drug wholesalers, and medical device wholesalers. Conglomerates would have to choose a side on which to continue operating and divest all entities on the other side within a year.
“There’s no question that massive health care companies have created layers of complexity to jack up the price of everything from prescription drugs to a visit to the doctor,” Senator Warren said in her press release. Breaking up conglomerates is “the only way to make health care more affordable.”
One of the best examples of how big these conglomerates have grown is United Health. The corporation owns or controls more than 7,000 hospitals. It also offers commercial insurance and Medicare Advantage Plans and operates PBMs and companies that process data, claims, and analytics. Under the bill, it would have to choose between its insurance and PBM businesses or its providers.
CVS would also face a difficult choice. It runs more than 9,000 retail pharmacy locations and has 300,000 employees, making it the largest pharmacy in the U.S. It also owns CVS Caremark, a dominant PBM, and the health insurance company Aetna. Assuming CVS wants to keep its pharmacies, it would have to divest CVS Caremark and Aetna to comply with the law.
Breaking up Big Medicine would benefit patients by removing the inherent conflict of interest that exists under the current system. Conglomerates who own every link in the supply chain are well-positioned to prioritize profits over patients. As public companies, they have a fiduciary duty to maximize shareholders’ returns. But medical providers are bound by oath to prioritize their patients’ health ahead of profits.
For instance, breaking up these vertically integrated networks would mean Big Medicine would no longer be able to decide what gets covered or to steer patients to affiliated providers, set prescription drug prices, dispense prescriptions, and control the data that directs health care decisions. Likewise, independent pharmacies and doctors’ offices would stand a better chance to compete with the behemoths by removing the threat of being acquired by a conglomerate.
The bill stands in sharp contrast to a competing vision promoted by Senator Bernie Sanders, which he calls Medicate for All, an idea that he and other Democrats have proposed in various forms for the last couple of decades. Medicare for All is designed to provide healthcare to all Americans and remove the byzantine layers of fees — premiums, co-payments, and deductibles — that characterize the U.S. healthcare system. But given the extreme antipathy of most Republicans and many Democrats to any solution that looks like “socialized medicine,” the bipartisan Break Up Big Medicine Act may prove more politically viable.
The bill’s authors still have to work out some kinks. As currently written, nonprofits like The Kaiser Foundation may also have to divest part of their business. Kaiser has long operated under an integrated care model that combines medical care and health insurance into a single system. Unlike the healthcare conglomerates, Kaiser and other nonprofits are not incentivized to put financial interests ahead of patients, and the bill should be amended to ensure they are not treated the same as conglomerates.
New Open Markets Report Urges Legislators Not to Bail Out Big Tech When AI Bubble Bursts
Open Markets Institute published a pioneering report “No Bailouts for Big Tech Billionaires: Policies for When the AI Bubble Bursts,” urging policymakers to prepare for the fallout from the likely collapse of the AI bubble and resist future demands for a bailout from Big Tech, which has plied trillions of dollars in investment into the industry over the last few years. Written by Open Markets fellow Matt Scherer, the report highlights how the AI boom bears the hallmarks of a speculative bubble, including massive debt-fueled spending on AI infrastructure despite weak revenues; deceptive accounting practices that inflate profits and conceal risk; heavy reliance on shadow banking and private credit markets; and stock valuations detached from underlying earnings. The report also rejects the notion that taxpayers would need to rescue tech firms to prevent financial contagion. Unlike banks, Scherer argues, AI companies can go through normal bankruptcy proceedings without threatening the core functioning of the financial system. Read the full report here and listen to the report here.
Open Markets Thanks Proton Foundation for Including Us in Annual Fundraiser
The Open Markets Institute, the Center for Journalism and Liberty at OMI, and OMI Europe are deeply grateful for being invited to participate in the most recent Proton Lifetime Charity Fundraiser. The event was organized by the Proton Foundation, the nonprofit governing organization behind the secure email provider Proton Mail, and is designed to support efforts to build a digital economy that strengthens democracy, privacy, and fair competition. The fundraiser brought in more than $1 million for 10 digital rights groups, underscoring the scale and urgency of the threats posed by today’s dominant, surveillance-driven tech models. Importantly, as Open Markets noted in our statement of thanks, Proton’s subscription-based, privacy-first model stands in contrast to platforms that rely on data extraction and behavioral targeting — offering a real-world example that a different kind of internet is possible. Read the full post here: Building a Democratic Digital Future Together.
📝 WHAT WE'VE BEEN UP TO:
Center for Journalism & Liberty at Open Markets Institute released a joint white paper with the Washington Monthly Institute examining how AI is deepening the power imbalance between technology platforms and independent journalism. Written by CJL director Courtney Radsch, “AI and the Future of Independent Journalism: The Promise and Peril of Privately Controlled Data Markets for Media Content,” warns that while tools like crawler controls, bot verification, and pay-per-crawl systems could help publishers enforce consent and receive compensation, they could also create new chokepoints if controlled by a small number of infrastructure providers.
The Capitol Forum hosted a conference call with CJL@OMI’s Dr. Courtney Radsch to discuss her new report, “Same Gatekeepers, New Tollbooths,” which examines the emerging market for AI content licensing. The discussion explored how AI companies source and pay for content, the rise of a three-tiered licensing market, the growing role of intermediaries, and the risk that publishers and creators could become increasingly dependent on the same dominant platforms shaping the future of information access.
Open Markets Institute released a new “Industry Spotlight” report by Audrey Stienon, who directs OMI’s industrial policy program, examining how private equity increasingly shapes industries across the economy and outlining policy tools to better align the industry with the public interest. Building on Stienon’s earlier research into private equity’s impact on childcare, the report argues that private equity is no longer a niche financial practice but a major force influencing sectors from healthcare to housing, and calls for stronger transparency, accountability, worker protections, and antitrust enforcement to curb harmful practices and protect communities.
Claire Kelloway collaborated with the Institute for Local Self-Reliance, the Minnesota Farmers Union, and two rural Minnesota groccery store owners to lead a breakout session at the National Rural Groccery Summit in Fargo, ND. Their session highlighted the potential for federal- and state-level enforcement of the Robinson-Patman Act to support independent, rural grocers, and empowered grocers to engage in advocacy.
OMI policy and advocacy lead Girogos Verdi spoke on a panel hosted by the German Marshall Fund on “The Global Governance of Digitalization.” In his remarks, Verdi highlighted how the EU’s position could be jeopardized by a deregulatory agenda that would further entrench the dominance of tech giants within the EU Single Market.
Open Markets senior legal analyst Daniel Hanley spoke at the University of Memphis law school’s event titled “Countervailing Power: Antimonopoly for Workers,” where he discussed how certain business practices like union-busting and obstruction of the unionization process can violate the antitrust laws and constitute unfair methods of competition in violation of federal and state law.
Open Markets policy counsel Tara Pincock participated on a panel on algorithmic pricing at the Informa Connect Antitrust West Coast conference, on which she discussed how algorithmic pricing is shaping competition dynamics and what it means for regulators and businesses alike.
CJL@OMI director Courtney Radsch was also quoted on the topic of AI-related compensation for publishers in the Seattle Times, in which she commented on Australia’s new proposal to force platforms to compensate publishers. Describing compensation related to AI models as a “huge hole,” she said the draft proposal still acknowledges “you can’t just take other people’s work and products and sell it, which is essentially what they’re doing.”
🔊 ANTI-MONOPOLY RISING:
ABC filed a complaint against the Federal Communications Commission for violating its free speech rights, in a major departure from the general deference broadcast networks have shown to the Trump administration until now. Although the dispute on behalf of a single ABC station in Houston appeared minor, ABC complained that regulators had a “chilling effect” on free speech by trying to punish political content they disagreed with. (New York Times)
The EU’s Court of Justice, its highest legal authority, ruled against Meta in its dispute with Italian regulators over whether the corporation should compensate publishers for using their news content. (Reuters)
Italy’s antitrust regulator is investigating Booking.com over the online travel company’s preferred partner program that gives accommodation providers who meet certain eligibility criteria improved visibility in search results in return for a small increase in commission. (Wall Street Journal)
The Department of Justice (U.S. DOJ) and a bipartisan coalition of six states attorneys general, including California and Minnesota, reached a settlement with Agri Stats, which provides pricing data to the meatpacking industry. The settlement would force Agri Stats, accused of fostering price collusion among leading companies like Tyson Foods and Perdue Farms, to sell its reports to anyone, including grocery stores and food supply companies that buy large amounts of meat. (New York Times)
📈 VITAL STAT:
49,000
The number of residents in the Lake Tahoe area who were told by their utility that they will no longer receive electricity because it is being redirected to AI data centers. NV Energy said it will stop providing electricity to the California side of Lake Tahoe within 12 months. (The Independent)
📚 WHAT WE'RE READING:
When Companies Run the Courts: How Forced Arbitration Became America’s Secret Justice System: In his latest book, former special counsel for the DOJ’s antitrust division Brendan Ballou exposes the private sector’s rampant use of forced arbitration, in which decisions are made in secret and so-called judges are paid for by the companies being sued. Ballou narrates the history of the now ubiquitous practice of forced arbitration and what we can do to escape it.