New 'Patients Over Profit Act' Forces Health Insurers to Sell Off Medicare Clinics and Labs

The “Patients Over Profit Act” (POP Act) is taking a direct shot at the vertical integration that has become common in healthcare. Simply put, this bill says that companies can no longer own both a health insurance company and certain types of medical providers—like clinics or labs—if those providers get paid through Medicare Part B or Medicare Advantage. This is a big deal because it targets the structure of how many large health systems operate today, where the insurer and the provider are essentially the same company.

The Ban on Dual Ownership: Why It Matters

Think about your primary care doctor’s office or a specialized testing facility. If the company that owns your health insurance also owns that clinic, they have a built-in incentive to steer you toward their own services, even if a cheaper or better option exists nearby. This bill aims to eliminate that conflict of interest, arguing that it drives up costs and limits patient choice. Under the POP Act, it becomes illegal for one entity to “own, control, or operate” both the insurance issuer and an “applicable provider.” The providers targeted here are those that bill Medicare, but notably, the bill explicitly carves out hospitals, pharmacies, and durable medical equipment suppliers from this ban. This means the integration ban hits specific outpatient services but leaves major hospital systems untouched.

The Forced Sale and the Clock is Ticking

For companies already operating under this dual-ownership model, the bill isn’t just a slap on the wrist; it’s a forced breakup. If a company acquired both sides before the law was enacted, they get two years to sell off either the insurance arm or the provider arm. If they made the acquisition after the law passes, they only get one year. This mandatory divestiture within a tight timeline could create a rush of sales in the healthcare market. The FTC and DOJ will be watching these sales closely, reviewing them even if they are too small to normally trigger federal review, ensuring the sales actually benefit competition and the public interest.

Enforcement: Taking Back the Profits

This isn't just about shuffling ownership; it has teeth. If the Inspector General, the FTC, or a State Attorney General believes a company is violating this rule, they can sue. If the court agrees, the company must stop the illegal ownership immediately. Even more compelling, the court must force the violator to return all the money they earned from providing healthcare services while they were in violation. Those ill-gotten gains don’t just go back to the government; they are put into a special fund managed by the FTC and used to benefit the healthcare needs of the community that was harmed. This mechanism is designed to directly punish those who profit from the conflict of interest and redirect that money to patients.

What This Means for Your Medicare Plan

Starting in 2026, the rules get even stricter for Medicare Advantage (MA) and Part D plans. The government cannot contract with or pay any MA organization if that organization violates the new ownership ban. If an MA plan tries to submit a claim while breaking this rule, the bill treats that claim as a false or fraudulent claim under federal law. Essentially, if you’re a Medicare beneficiary, this bill is designed to ensure that your MA plan isn’t secretly prioritizing its own clinics over your best interests. The hope is that by eliminating this structural conflict, competition will increase, leading to better pricing and more transparent care options for seniors.