Executive Summary
Anti-steering, anti-tiering, and all-or-nothing bundled contracting are mechanisms by which dominant hospital systems insulate themselves from price competition: anti-steering prohibits insurers from directing patients toward lower-cost providers; anti-tiering is one form of anti-steering that bars insurers from placing the dominant system in a less favorable benefit tier; and all-or-nothing contracting requires insurers to accept every hospital and affiliated physician in the system or none at all. The DOJ's February 2026 complaint against OhioHealth and March 2026 complaint against New York-Presbyterian allege that anti-steering restrictions are anticompetitive. Both cases are pending.
This memo develops estimates of the hospital price and health insurance premium reductions that would follow a nationwide ban on all three mechanisms collectively. We estimate that a ban would reduce hospital and affiliated-physician prices by 18 percent (with a plausible range of 11 to 26 percent), averaging ~$4,100 per inpatient admission, in directly affected markets through three channels: restored insurer bargaining leverage, patient sorting to lower-cost providers, and over time, additional price concessions as removing the clauses allows competing systems to become more credible alternatives to insurers. After scaling by the hospital and affiliated-physician share of total employer-sponsored insurance (ESI) spending (approximately 57 percent) and applying a 70 percent pass-through rate, ESI premiums in directly affected markets would fall by an estimated 6.5 percent (ranging from 4 to 9 percent).
In directly affected markets, that premium reduction corresponds to savings of ~$1800 ($1,100 to $2,500) per family annually and ~$600 ($380 to $860) per individual (2025 dollars). Because the economic incidence of ESI premiums falls on workers, these savings flow to employees through some combination of lower out-of-pocket premium costs and higher take-home wages. Reduced hospital prices also raise payroll and employment at non-health-care employers and increase federal income tax receipts, with gains concentrated among lower- and middle-income workers. We estimate that 24 percent of Americans covered by ESI are in markets where these clauses are binding and consequential. Scaling our estimates to account for that indicates that nationwide ESI premium savings of 1.6 percent, amounting to ~$45 billion ($29 to $63 billion) per year.
The expected effects vary by market structure. In markets with a dominant system and competitive insurers, we expect premium reductions of 4 to 6 percent. Where both the hospital system and insurer have market power, the estimated reduction is 2 to 3 percent. In more competitive markets with lower clause prevalence, 1 to 2 percent.
For rural communities, multi-market systems may use anti-steering and all-or-nothing contracts to extend urban market power to rural hospitals, elevating prices in those communities. A ban could reduce premiums for rural workers and employers, improve the negotiating position of independent rural hospitals, and impose minimal pressure on system-owned rural hospitals.
