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UPDATE 2-Biden caps credit card late fees at $8, probes US healthcare takeovers

(Adds context on private equity deals, economy in paragraphs 1-11)

By Jarrett Renshaw and David Shepardson

WASHINGTON, March 5 (Reuters) - The Biden administration on Tuesday said it would limit what banks can charge for late credit card payments and probe whether the private equity industry is making healthcare cost more for Americans, the latest crackdown on high consumer costs.

The Justice Department and the Federal Trade Commission (FTC) "strike force" will aim at illegal corporate behavior that hikes prices on Americans through anticompetitive or fraudulent business practices, administration officials said.

Separately, the FTC, the Justice Department and the Department of Health and Human Services (HHS) will investigate the "impact of corporate greed in health care" focusing on transactions involving private equity.

It will probe how private equity deals "may increase consolidation and generate profits for firms while threatening patients’ health, workers’ safety, quality of care, and affordable health care for patients and taxpayers."

Private equity buyers have spent hundreds of billions of dollars buying thousands of healthcare-related companies in the United States in the past decade, driving up costs, often with little regulatory oversight, research groups, including the National Institute for Health Care Management, have found.

The agencies issued a Request for Information (RFI) requesting public comment on healthcare deals conducted by health systems, private equity and other asset managers.

The administration will also finalize a rule that slashes credit card fees from an average of $31 down to $8, and another that gives ranchers and farmers more leverage when negotiating contracts with meat-packers, officials said.

Biden will announce the moves at the White House on Tuesday, as his Competition Council, which aims at anticompetitive practices in sectors from agriculture to drugs and labor, meets.


U.S. inflation has fallen, job growth and spending continue to be strong and overall the U.S. economy is performing better than expected. But the high cost of consumer items from groceries to housing is contributing to American voters' concerns about Democratic President Joe Biden's economic policies.

Biden, who is seeking reelection in November, has frequently targeted "greedy" CEOs, and previously cracked down in airline junk fees and insulin pricing.

The president has successfully pressured companies such as Airbnb and Live Nation to limit junk fees - or extra charges - that customers pay when booking concert tickets, hotels and airfares.

The White House Council of Economic advisers estimates that the administration's actions will eliminate more than $20 billion in junk fees annually. The moves to counter junk fees is expected to feature in Biden's State of Union Speech on Thursday, White House aides say.

Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra said the limit on credit card late fees will save American families $10 billion annually, or an average of $220 per year for the 45 million cardholders who are charged late fees annually.

Credit card issuers have been exploiting a loophole created in 2010 that allowed them to escape a federal ban on unreasonable fees by increasing them each year with automatic inflation adjustments, Chopra said.

The Department of Agriculture rule, first proposed last September, prohibits among other things retaliation against producers for activities like asserting rights under the Packers and Stockyards Act, which aims to ensure competition in the livestock, meat and poultry markets.

"This final rule will provide for clearer, more effective standards by which to govern all of this in the modern marketplace," Agriculture Secretary Tom Vilsack said Monday. (Reporting By Jarrett Renshaw and David Shepardson; additional reporting by Leah Douglas; Editing by Don Durfee, Leslie Adler, Heather Timmons and Jonathan Oatis)