FTC Staff Comment Before the Legislative Council of Delaware Sunset Review Committee Concerning Sunset Review of the Board of Optometric Examiners

FEDERAL TRADE COMMISSION
WASHINGTON. D. C. 20580
BUREAU OF
CONSUMER PROTECTION
Mr. 	Stephen 	P. 	Tanzer
Legislative 	Council 	of 	Delaware
Sunset 	Review 	Committee
P.O. 	Box 	1401
Dover, 	Delawure 	19901
Dear 	Mr. 	Tanzer:
May 	31, 	1985
We 	are 	pleased 	to 	respond 	to 	your 	request 	for 	assistance 	in
your 	sunset 	review 	of 	the 	Delaware 	State 	Board 	of 	Optometric
Examiners 	by 	providing 	comments 	concerning 	the 	competitive 	and
consumer 	effects 	of 	laws 	and 	regulations 	that 	prohibit 	certiin
business 	practices 	by members 	of 	the 	optometric 	profession.
The 	Federal 	Trade 	Commission 	seeks 	to 	promote 	competition
among 	members 	of 	licensed 	professions 	to 	the 	maximum 	extent
compatible 	w:Lh 	other 	legitimate 	state 	and 	federal 	goals. 	For
several 	yearl, 	the 	Commission 	has 	been 	investigating 	the 	effects
of 	state 	restrictions 	on 	the 	business 	practices 	of 	professionals,
including 	optometrists, 	dentists, 	lawyers, 	physicians, 	and
others. 	Our 	goal 	is 	to 	identify 	and 	seek 	the 	removal 	of
restrictions 	that 	impede 	competition, 	increase 	costs 2 and 	harm
consumers 	without 	providing 	countervailing 	benefits. 	In 	this
regard, 	the 	Commission 	recently 	issued 	a 	Notice 	of 	Proposed
Rulemaking 	for 	a 	Proposed 	Ophthalmic 	Trade 	Regulation 	Rule 	that
would 	prohibit, 	among 	other 	things, 	state-imposed 	bans 	on 	trade
name 	usage 	and 	bans 	on 	employment 	~r 	other 	relationships 	between
optometrists 	and 	non~optometrists. 	The 	Commission 	stated 	in 	its
Notice 	that 	public 	restraints 	on 	the 	permissible 	forms 	of
1 	These 	comments 	represent 	the 	views 	of 	the 	Bureaus 	of 	Consumer
Protection, 	Competition, 	and 	Economics 	of 	the 	Federal 	Trade
Commission 	and 	do 	not 	necessarily 	tepresent 	the 	views 	of 	the
Commission 	or 	any 	individual 	Commiss~oners. 	The 	Commission,
however, 	has 	authorized 	the 	submission 	of 	these 	comments.
2 	The 	Commission 	is 	empowered 	under 	15 	u.s.c. 	S 	41 	et~· 	to
prevent 	unfair 	methods 	of 	competition 	and 	unfair 	or 	deceptive
acts 	or 	practices 	in 	or 	affecting 	commerce. 	It 	has 	joint
responsibility 	with 	the 	Department 	of 	J~stice 	for 	enforcement 	of
the 	federal 	antitrust 	laws.
3 	See 	50 	Fed. 	Reg. 	598 	(1985).

Mr. 	Stephen 	P. 	Tanzer 	-2 -
ophthalmic 	practice 	appear 	to 	increase 	consumer 	prices 	for
ophthalmic 	goods 	and 	ser~ices, 	but 	do 	not 	appear 	to 	protect 	the
public 	health 	or 	safety.
We 	strongly 	support 	the 	Board ' s 	proposal 	to 	broaden 	the
scope 	of 	permissible 	advertising 	and 	commercial 	practices 	by
optometrists. 	The 	proposed 	statutory 	and 	rule 	changes, 	however,
retain 	restrictions 	that 	could 	unnecessarily 	harm 	consumers 	and
discourage 	competition. 	In 	the 	enclosed 	comments, 	we 	discusss
several 	such 	restrictions. 	First, 	we 	address 	proposed 	and
existing 	statutory 	restraints 	on 	professional 	relationships
between 	optometrists 	and 	non-optometrists. 	Second, 	we 	discuss 	a
prohibition 	on 	operating 	under 	trade 	names 	which 	appears 	to 	go
beyond 	that 	necessary 	to 	prevent 	deception. 	Third, 	we 	express
concerns 	about 	what 	appear 	to 	be 	overly 	broad 	restrictions 	on
advertising 	and 	in-person 	solicitations.
Thank 	you 	for 	the 	opportunity 	to 	comment 	on 	your 	proposed
statute 	and 	rules. 	In 	addition 	to 	our 	comments, 	we 	have 	enclosed
copies 	of 	two 	studies 	to 	which 	we 	refer 	in 	the 	comments. 	Please
let 	us 	know 	if 	we 	can 	be 	of 	any 	further 	assistance.
Enclosures
4 	Id. 	at 	599-600.
Sincerely,
(' ~ 	T c~~1/75
Carol 	T. 	Crawford
Director

COMMENTS 	OF 	THE 	BUREAUS 	OF
CONSUMER 	PROTECTION, 	COMPETITION, 	AND 	ECONOMICS
OF 	THE 	FEDERAL TRADE 	COMMISSION
TO 	THE
LEGISLATIVE 	COUNCIL 	OF 	THE 	STATE 	OF 	DELAWARE
SUNSET 	REVIEW 	COMMITTEE
ON
REVIEW 	OF 	THE 	DELAWARE 	OPTOMETRY 	LAW AND
REGULATIONS 	OF 	THE 	BOARD 	OF 	OPTOMETRIC 	EXAMINERS
MAY 	31, 	1985
These 	comments 	represent 	the 	views 	of 	the 	Bureaus 	of 	Consumer
Protection, 	Competition, 	and 	Economics 	of 	the 	Federal 	Trade
Commission 	and 	do 	not 	necessarily 	represent 	the 	views 	of 	the
Commission 	or 	any 	individual 	Commissioner. 	The 	Commission,
however, 	has 	authorized 	the 	submission 	of 	these 	comments.

The 	Bureaus 	of 	Consumer 	Protection, 	Competition, 	and
Economics 	support 	the 	Delaware 	Board 	of 	Optometric 	Examiners'
("Board") 	proposal 	to 	lessen 	restrictions 	on 	permissible
optometric 	advertising 	and 	commercial 	practices. 	We 	believe,
however, 	that 	competition 	and 	consumer 	welfare 	would 	be 	well
served 	by 	further 	lessening 	the 	restrictions. 	These 	comments 	set
forth 	our 	suggested 	changes 	and 	raise 	questions 	that 	we 	believe
the 	Board 	should 	consider 	during 	this 	sunset 	review.
Commercial 	Practice
The 	current 	Delaware 	Optometry 	Law 	and 	Board 	Rules 	contain
numerous 	provisions 	that may 	unnecessarily 	hamper 	optometrists 	in
their 	choice 	of 	ways 	to 	market 	their 	services 	in 	a 	nondeceptive,
yet 	cost-efficient 	manner. 	The 	most 	significant 	provisions
prohibit 	optometrists 	from 	practicing 	under 	trade 	names, 	locating
offices 	in 	mercantile 	establishments, 	affiliating 	with 	opticians,
and 	affiliating 	in 	any 	way 	with 	lay 	organizations 	or 	persons,
whether 	through 	employment, 	partnership 	or 	a 	corporation.l 	The
proposed 	amendments 	would 	eliminate 	both 	the 	restrictions 	on
practice 	location 	and 	the 	express 	prohibition 	on 	delegating 	the
fitting 	of 	contact 	lenses 	to 	opticians, 	which 	are 	positive
steps. 	The 	proposal 	would 	retain, 	however, 	the 	prohibitions 	on
1 See 	Delaware 	Code 	Annotated, 	Title 	24, 	Chapter 	21, 	sections
210l(b), 	2113(a) (7) (c), 	(d), 	(f), 	(n) 	and 	Board 	Rules 	4.03, 	4.08,
4.09, 	4.10, 	4.11, 	4.12.
2

using 	trade 	names2 	and 	affiliating 	with 	non-optometrists.3
One 	such 	restriction 	is 	contained 	in 	proposed 	section
2113(a)(l3), 	which 	would 	forbid 	an 	optometrist 	from 	practicing
under 	any 	arrangement 	with 	any 	company 	other 	than 	a 	professional
corporation. 	Section 	210l(b)(2), 	which .is 	part 	of 	the 	existing
law, 	would 	also 	ban 	professional 	relationships 	with 	non-
optometrists, 	including 	the 	employment 	of 	professional
.
managers.4 	Moreover, 	proposed 	section 	2113(a)(7)(a) 	would
continue 	to 	ban 	trade 	names 	by 	forbidding 	an 	optometrist 	from
listing 	"in 	a 	telephone 	directory 	or 	otherwise 	holding 	himself
[or 	herself] 	out 	as 	practicing 	under 	any 	name 	other 	than 	the
name" 	under 	which 	the 	optometrist 	is 	registered. 	Restrictions
2 The 	proposal 	also 	requires 	eliminating 	from 	a 	firm's 	name 	the
name 	of 	any 	practitioner 	who 	leaves 	the 	business.
3 The 	Commission 	recently 	issued 	a 	Notice 	of 	Proposed 	Rulemaking
for 	a 	Trade 	Regulation 	Rule 	that 	would 	preempt 	state 	laws 	and
regulations 	that 	ban 	trade 	names, 	professional 	relationships
between 	optometrists 	and 	non-opcometrists, 	locating 	in 	mercantile
establishments 	and 	branch 	offices. 	In 	its 	notice, 	the 	Commission
stated 	that 	such 	restraints 	appear 	to 	increase 	prices 	without
providing 	offsetting 	public 	health 	or 	safety 	benef~ts. 	See 	50
Fed. 	Reg. 	598, 	599-600 	(1985).
4 	That 	section 	states:
(b) 	Any 	person 	shall 	also 	be 	deemed 	to 	be 	practicing 	the
profession 	of 	optometry 	who 	-
( 1 )
(2)
. . 	. .
Opens 	for 	practice 	or 	operates, 	conducts 	or
manages 	an 	office 	in 	this 	state, 	either
directly 	or 	indirectly, 	where 	optometric
practice 	is 	carried 	on 	with 	the 	intent 	of
receiving 	therefrom, 	either 	directly 	or
indirectly, 	any 	money, 	gift 	or 	any 	form 	of
compensation 	which 	might 	result 	from 	any 	part
· of 	the 	practice 	of 	optometry 	as 	defined 	in 	this
section
3

such 	as 	these 	on 	the 	business 	practices 	of 	professi9nals 	can
reduce 	competition 	in 	health 	care 	markets 	by 	preventing 	the
formation 	and 	development 	of 	innovative 	forms 	of 	professional
practice, 	such 	as 	chain 	firms. 	Such 	firms 	may 	have 	the 	potential
to 	offer 	lower 	prices, 	or 	to 	offer 	longer 	office 	hours 	or 	faster
service 	than 	traditional 	practitioners.
Trade 	name 	bans 	could 	create 	special 	problems 	for 	chains 	or
group 	practices 	that 	employ many 	practitioners 	and 	provide
service 	on 	a 	state-wide 	or 	regional 	basis. 	Trade 	names 	can 	be
virtually 	essential 	to 	such 	practices. 	They 	are 	chosen 	because
they 	are 	easy 	to 	remember 	and 	because 	they 	can 	convey 	useful
information 	such 	as 	the 	l~cation, 	or 	other 	characteristics 	of 	a
practice. 	Over 	time, 	trade 	names 	can 	come 	to 	be 	associated 	with
a 	certain 	level 	of 	quality, 	service, 	and 	price, 	thus 	facilitating
consumer 	search. 	If 	trade 	names 	are 	forbidden, 	larger 	practices
lose 	an 	important 	marketing 	tool. 	Prohibiting 	the 	use 	of 	a 	trade
name 	in 	lieu 	of 	the 	names 	of 	individual 	licensees 	could 	make
advertising, 	which 	is 	also 	essential 	to 	most 	large 	group
practices, 	prohibitively 	expensive, 	particularly 	on 	television 	or
radio. 	This 	provision 	could 	discourage 	the 	development 	of 	such
firms 	by 	effectively prohibiting 	advertising 	by 	large 	group
practices 	and 	chains.
We 	recognize 	the 	necessity 	of 	ensuring 	identification 	and
accountability 	of 	individual 	practitio~ers 	practicing 	under 	a
trade 	name. 	However, 	there 	may 	be 	effective 	ways 	to 	achieve 	this
goal 	without 	impeding 	the 	development 	of 	large 	group practices
and 	chains. 	For 	example, 	states 	might 	require 	that 	the 	names 	of
4

individual 	practitioners 	be 	conspicuously 	posted 	in 	professional
offices 	and 	noted 	on 	receipts 	and 	patient 	records.
Restrictions 	on 	optometrists 	affiliating 	with 	lay
corporations 	may 	limit 	the 	availability 	of 	equity 	capital 	for
professional 	practices 	and 	hinder 	the 	development 	of 	high-volume
practices. 	These 	firms 	can 	provide 	comparable 	quality 	services
and 	create 	competitive 	pressure 	on 	traditional 	providers 	to 	pay
greater 	attention 	to 	their 	own 	costs 	and 	fees.
In 	a 	case 	challenging 	ethical 	code 	provisions 	enforced 	by
the 	American 	Medical 	Association 	("AMA"), 	the 	Commission 	found
that 	AMA 	rules 	prohibiting 	physicians 	from 	working 	on 	a 	salaried
basis 	for 	a 	hospital 	or 	other 	lay 	institution 	and 	from 	entering
. into 	partnerships 	or 	similar 	relationships 	with 	non-physicians
unreasonably 	restrained 	competition 	and 	violated 	the 	antitrust
laws. 5 	The 	Commission 	concluded 	that 	the 	AMA's 	prohibitions 	kept
physicians 	from 	adopting 	more 	economically 	efficient 	business
formats 	and 	that, 	in 	particular, 	these 	restrictions 	precluded
competition 	by 	organizations 	not 	directly 	and 	comp~etely 	under
the 	control 	of 	physicians. 	The 	Commission 	also 	found 	that 	there
were 	no 	countervailing 	procompetitive 	justifications 	for 	these
restrictions.
Proponents 	of 	restrictions 	on 	employment, 	partnership 	or
other 	business 	relationships 	between iicensed 	professionals 	and
non-licensees 	and 	restrictions 	on 	the,use 	of 	trade 	names 	claim
5 	In 	re 	American 	Medical 	Association, 	94 	F.T.C. 	701 	(1979),
aff'd, 	638 	F.2d 	443 	(2d 	Cir. 	1980), 	aff'd 	mem. 	by 	an 	equally
divided 	court, 	455 	U.S. 	676 	(1982).
5

that 	restrictions 	are 	necessary 	to 	maintain 	a 	high 	level 	of
quality 	in 	the 	professional 	services 	market. 	For 	example,
proponents 	claim 	that 	employer-employee 	and 	other 	business
relationships 	between 	professionals 	and 	non-professionals 	will
diminish 	the 	overall 	quality 	of 	care 	because 	of 	lay 	interference
with 	the 	professional 	judgment 	of 	licensees. 	They 	assert 	that
lay 	corporations 	such 	a~ chain 	retailers 	would 	be 	unduly
concerned 	with 	profits 	to 	the 	detriment 	of 	the 	qualiti 	of
professional 	care. 	They 	also 	allege 	that, 	while 	lay 	firms 	might
offer 	lower 	prices, 	such 	firms 	might 	also 	encourage 	their
professional 	employees 	to 	cut 	corners 	to 	maintain 	profits. 	The
public 	would 	suffer 	doubly, 	according 	to 	those who 	favor
.restrictions, 	because 	professionals 	who 	practice 	in 	traditional,
non-commercial 	settings 	would 	be 	forced 	to 	lower 	the 	price 	and
quality 	of 	their 	services 	in 	order 	to 	meet 	the 	prices 	of 	their
commercial 	competitors.
-
The 	Federal 	Trade 	Commission's 	Bureaus 	of 	Economics 	and
Coniumer 	Protection 	have 	issued 	two 	studies 	that 	p~ovide 	evidence
that 	restrictions 	on 	commercial 	practice 	by 	optometrists
including 	restrictions 	on 	business 	relationships 	between
optometrists 	and 	non-optometrists 	and 	limits 	on 	the 	use 	of 	trade
names 	-- 	do, 	in 	fact, 	harm 	consumers.
The 	first 	study,6 	conducted 	with 	the 	help 	of 	two 	colleges 	of
optometry 	and 	the 	chief 	optometrist 	of ' the 	Veterans 	Admini-
6 Bureau 	of 	Economics, 	Federal 	Trade 	Commission, 	Effects 	of
Restrictions 	on 	Adve~tising 	and 	Commercial 	Practice 	in 	the
Professions: 	The 	Ca~2 	of 	Optometry 	(1980).
6

stration, 	compared 	the 	price 	and 	quality 	of 	eye 	examinations 	and
eyeglasses 	in 	cities 	with 	a 	variety 	of 	legal 	environments.
Cities 	were 	classified 	as 	markets 	where 	advertising 	was 	present
if 	there 	was 	advertising 	of 	eyeglasses 	or 	eye 	exams 	in 	local
newspapers 	or 	"Yellow 	Pages." 	Cities 	were 	classified 	as 	markets
with 	chain 	optometric 	practice 	if 	eye 	examinations 	were 	available
at 	large 	interstate 	opt~cal 	firms. 	This 	study 	provides 	important
information 	on 	the 	likely 	effects 	of 	state 	laws 	that 	testrict 	the
operation 	of 	chain 	optometric 	firms.
The 	study 	found 	that 	prices 	charged 	in 	1977 	for 	eye
examinations 	and 	eyeglasses 	were 	significantly 	higher 	in 	cities
without 	chain 	firms 	and 	advertising 	than 	in 	cities 	where
. advertising 	and 	chain 	firms 	were 	present. 	The 	average 	adjusted
price 	charged 	by 	optometrists 	in 	the 	cities 	without 	chain 	firms
and 	advertising 	was 	33.6 	percent 	higher 	than 	in 	the 	cities 	with
advertising 	and 	chains 	($94.46 	versus 	$70.72). 	Prices 	were
approximately 	17.9 	percent 	higher 	if 	chain 	firms 	offering 	eye
exams 	were 	not 	present; 	the 	remaining 	15.7 	percent 	price
difference 	was 	attributed 	to 	the 	absence 	of 	advertising.
The 	data 	also 	showed 	that 	the 	quality 	of 	vision 	care 	was 	not
lower 	in 	cities 	where 	chain 	optometric 	practice 	and 	advertising
were 	present. 	The 	thoroughness 	of 	eye 	examinations, 	the 	accuracy
of 	eyeglass 	prescriptions, 	the 	accur~cy 	and 	workmanship 	of
eyeglasses, 	and 	the 	extent 	of 	unnecessary 	prescribing 	were, 	on
average, 	the 	same 	in 	both 	types 	of 	cities.
The 	second 	study 	issued 	by 	the 	FTC 	staff 	compared 	the 	cost
and 	quality 	of 	cosmetic 	contact 	lens 	fitting 	by 	various 	types 	of
7

eye 	care 	professionals.? 	This 	study 	was 	designed 	and 	conducted
with 	the 	assistance 	of 	the 	major 	national 	professional
associations 	representing 	ophthalmologists, 	optometrists 	and
opticians. 	Its 	findings 	are 	based 	on 	examinations 	and 	interviews
of 	more 	than 	500 	contact 	lens 	wearers 	in 	18 	urban 	areas.
The 	study 	found 	that 	there 	were 	few, 	if 	any, 	meaningful
differences 	in 	the 	quality 	of 	cosmetic 	contact 	lens 	fitting
provided 	by 	ophthalmologists, 	optometrists, 	and 	opticians. 	The
study 	also 	showed 	that, 	on 	average, 	"commercial" 	optometrists 	--
that 	is, 	optometrists 	who 	were 	affiliated 	with 	a 	chain 	optical
firm 	or 	advertised 	heavily 	-- 	fitted 	contact 	lenses 	at 	least 	as
well 	as 	other 	fitters, 	but 	charged 	significantly 	lower 	prices.
These 	studies 	provide 	evidence 	that 	restrictions 	o~:
employment, 	partnership, 	or 	other 	relationships 	between
professionals 	and 	non-professionals 	and 	limits 	on 	the 	use 	of
trade 	names 	by 	professionals 	tend 	to 	raise 	prices 	above 	the
levels 	that 	would 	otherwise 	prevail, 	but 	do 	not 	seem 	to 	raise 	the
quality 	of 	care 	in 	the 	vision 	care 	market.
Advertising 	and 	Solicitation
In 	its 	current 	form, 	the 	Optometry 	Law 	imposes 	a 	virtual 	ban
on 	advertising.a 	Such 	a 	ban 	is 	illegal. 	As 	the 	Commission
stated 	with 	regard 	to 	the 	American 	Medical 	Association's
advertising 	restrictions, 	advertising 	is 	so 	important 	to 	the
7 	Bureaus 	of 	Consumer 	Protection 	and 	Economics, 	Federal 	Trade
Commission, 	A Comparative 	Analysis 	of 	Cosmetic 	Contact 	Lens
Fitting 	by 	Ophthalmologists, 	Optometrists, 	and 	Opticians 	(1983).
8 	Del. 	Code 	An~. 	Tit . 	24, 	S 2113(a)(7)(a).
8

proper 	functioning 	of 	the 	market 	that 	the 	very 	nature 	of 	the
restrictions 	at 	issue 	was 	"sufficient 	alone 	to 	establish 	their
anticompetitive 	quality."9 	Citing 	the 	United 	States 	Supreme
Court's 	decisions 	in 	Bates 	v . 	State 	Bar 	of 	ArizonalO 	and 	Virginia
State 	Board 	of 	Pharmacy 	v . 	Virginia 	Citizens 	Consumer 	Council, 	11
the 	Commission 	recognized 	the 	importance 	of 	a 	free ·and 	competi-
tive 	market 	in 	the 	healtn 	care 	field:
9
Nor 	can 	it 	be 	questioned 	that 	broad 	bans 	on
advertising 	and 	soliciting 	are 	inconsistent 	with
the 	nation's 	public 	policy. 	"Advertising 	is 	the
traditional 	mechanism 	in 	a 	free 	market 	economy 	for
a 	supplier 	to 	inform 	a 	potential 	purchaser 	of 	the
availability 	and 	terms 	of 	exchange." 	• 	•• 	And
"[i]t 	is 	a 	matter 	of 	public 	interest 	that,
[purchasers'] 	decisions, 	in 	the 	aggregate, 	be
intelligent 	and 	well-informed." 	••• 	Apart 	from
its 	economic 	function,--commercial 	advertising 	may
convey 	important 	information 	of 	general 	public
interest. 	• 	• 	• 	On 	a 	more 	individual 	level,
restraints 	on 	the 	advertising 	of 	medical 	services
••• 	have 	a 	disproportionate 	effect 	on 	the 	poor,
the 	sick 	and 	the 	aged •••• 	Given 	the 	prevailing
94 	F.T.C. 	at 	1005.
lO 	433 	U.S. 	350 	(1977) 	(holding 	state 	supreme 	cour~ 	prohibition
on 	advertising 	invalid 	under 	the 	First 	Amendment 	to 	the 	United
States 	Constitution, 	and 	according 	great 	importance 	to 	the 	role
of 	advertising 	in 	the 	efficient 	functioning 	of 	the 	market 	for
professional 	services).
11 	425 	U.S. 	748 	(1976). 	The 	Court 	stated 	in 	reference 	to 	the
advertising 	of 	pharmaceutical 	drugs:
Advertising, 	however 	tasteless 	and 	expensive 	it
sometimes 	may 	seem, 	is 	nonetheless 	dissemination 	of
information 	as 	to 	who 	is 	producing 	and 	selling 	what
product, 	for 	what 	reason, 	and 4t 	what 	price. 	So
long 	as 	we 	preserve 	a 	predominately 	free 	enterprise
economy, 	the 	allocation 	of 	our 	resources 	in 	large
measure 	will 	be 	made 	through 	numerous 	private
economic 	decisions •••• 	To 	this 	end, 	the 	free
flow 	of 	commercial 	information 	is 	indispensable .
425 	u.s . 	at 	765 .
9

disparity 	of 	prices, 	information 	as 	to 	who 	is
charging 	what 	"could 	mean 	the 	alleviation 	of
physical 	pain 	or 	the 	enjoyment 	of 	£~sic
necessities." 	[citations 	omitted]
We 	are 	pleased 	to 	note 	that 	the 	proposed 	statutory
amendments 	eliminate 	many 	restrictions 	on 	advertising. 	The
statute 	would 	retain 	constraints 	against making 	false,
fraudulent, 	or 	misleading 	statements 	or 	engaging 	in 	conduct
likely 	to 	mislead 	the 	public.13 	The 	proposed 	rules, 	however,
contain 	much 	broader 	provisions.
Our 	experience 	in 	examining 	restrictions 	on 	professionals
together 	with 	our 	review 	of 	other 	empirical 	datal 4 	leads 	us 	to
conclude 	that, 	generally, 	only 	advertising 	that 	is 	false 	or
deceptive 	should 	be 	prohibited. 	Any more 	restrictive 	standard 	is
likely 	to 	suppress 	the 	dissemination 	of 	potentially 	useful
information 	and 	contribute 	to 	an 	increase 	in 	prices. 	we 	would
therefore 	recommend 	that 	the 	Board 	consider 	removing 	all
advertising 	restrictions 	except 	those 	that 	employ 	a 	false 	or
decept~ve 	standard. 	Such 	action 	would 	give 	consumers 	access 	to
more 	~omplete 	information 	about 	prices 	and 	other 	attributes 	of
12 	94 	F.T.C. 	at 	1011.
13 Proposed 	sections 	2113(a)(7)(c) 	and 	(a)(lO).
14 	Several 	empirical 	studies 	have 	confirmed 	the 	relationship
between 	advertising 	and 	lower 	prices 	in 	markets 	for 	professional
services. 	See,~., 	Bureau 	of 	Economics 	and 	Cleveland 	Regional
Office, 	Federal 	Trade 	Commission, 	Improving 	Consumer 	Access 	to
Legal 	Services: 	The 	Case 	for 	Removing 	Restrictions 	on 	Truthful
Advertising 	(1984); 	Muris 	& Mcchesney, 	Advertising 	and 	the 	Price
and 	Quality 	of 	Legal 	Services: 	The 	Case 	for 	Legal 	Clinics, 	1979
Arn. 	B. 	Found. 	Research 	J. 	179; 	Benham 	& Benham, 	Regulating
through 	the 	Professions: 	A Perspective 	on 	Information 	Control,
18 	J. 	Law 	& Econ. 	421 	(1975); 	Benham, 	The 	Effect 	of 	Advertising
on 	the 	Price 	of 	Eyeglasses, 	J. 	Law 	& Econ. 	337 	(1972).
10

available 	optometric 	services, 	while 	at 	the 	same 	time 	protecting
them 	from 	false 	or 	misleading 	claims. 	The 	greater 	availability
of 	information 	would 	enable 	consumers 	to 	make 	more 	informed
decisions 	about 	their 	optometric 	care. 	Accordingly, 	we 	think 	it
important 	that 	the 	Board 	reevaluate 	the 	advisability 	of 	some 	of
the 	proposed 	r~strictions.
First, 	Rule 	3 	could 	have 	the 	effect 	of 	prohibiting 	price
advertising 	of 	optometric 	goods 	or 	products 	unless 	such 	ads
contain 	voluminous 	information, 	much 	of 	which 	may 	not 	be 	helpful
to 	the 	consumer, 	particularly 	when 	received 	in 	the 	context 	of 	an
advertisement. 	The 	rule 	would 	require, 	for 	example, 	that 	price
ads 	for 	ophthalmic 	frames 	and 	lenses 	contain 	the 	n~me 	of 	the
.manufacturer, 	the 	manufacturer's 	identification 	numbet, 	and 	the
country 	of 	manufacture. 	It 	would 	require 	the 	inclusion 	of 	the
manufacturer's 	name 	and 	the 	country 	of 	manufacture 	in 	contact
lens 	ads. 	The 	rule 	would 	require 	that 	ads 	for 	each 	of 	these
three 	products 	contain 	numerous 	other 	items 	of 	information 	as
well. 	We 	recognize 	that 	affirmative 	disclosures 	may 	be 	justified
in 	some 	instances. 	Indeed, 	in 	the 	Commission's 	Rule 	on
Advertising 	of 	Ophthalmic 	Goods 	and 	Services,14 	it 	declared 	that
limited 	disclosure 	requirements 	created 	by 	state 	law 	would 	not
constitute 	violations 	of 	the 	FTC 	Act. 	The 	disclosure
requirements 	contained 	in 	the 	propos~d 	rules, 	however, 	seem 	much
14 	16 	C.F.R. 	Part 	456. 	On 	February 	6, 	1980, 	the 	United 	States
Court 	of 	Appeals 	for 	the 	District 	of 	Columbia 	remanded 	this 	rule
to 	the 	Commission 	for 	reconsideration 	in 	light 	of 	Bates 	v. 	State
Bar 	of 	Arizona. 	American 	Optometric 	Association 	v. 	FTC, 	626 	F.2d
896. 	The 	rule 	has 	not 	been 	reissued.
11

more 	extensive 	than 	those 	approved 	in 	the 	Ophthalmip 	Rule 	and 	may
provide 	no 	benefit 	to 	consumers. 	These 	requirements 	seem 	to
require 	disclosure 	of 	information 	only marginally 	related 	to 	the
primary 	message 	in 	a 	price 	advertisement. 	Consumers 	who 	desire
such 	information 	are 	not 	precluded 	from 	requesting 	it 	of 	the
advertiser. 	Moreover, 	the 	disclosures 	would 	require 	significant
time 	in 	a 	radio 	or 	television 	ad, 	and 	significant 	space 	in 	a
printed 	ad. 	Thus, 	they 	could 	greatly 	increase 	the 	cost 	of 	the
ad. 	We 	therefore 	believe 	the 	Board 	should 	reconsider 	the 	need
for 	any 	of 	the 	proposed 	disclosure 	requirements.
Second, 	Rule 	4 would 	limit 	price 	advertising 	to 	only 	two
"routine 	services" 	(eye 	exams 	and 	fitting 	of 	ophthalmic
. prosthetic 	devices), 	and 	require 	that 	price 	advertisements 	list
the 	services 	included 	in 	the 	examination. 	We 	suggest 	the 	Board
reconsider 	the 	obligation 	to 	list 	the 	components 	of 	an
examination, 	for 	the 	same 	reasons 	as 	explained 	above. 	We 	also
question 	whether 	it 	is 	necessa~y 	to 	circumscribe 	price
advertising 	so 	narrowly 	in 	order 	to 	prevent 	consumer 	deception.
Third, 	Rule 	6 would 	forbid 	use 	of 	the 	terms 	"specialist~
consultant, 	etc.," 	except 	where 	the 	optometrist 	is 	certified 	by
the 	American 	Academy 	of 	Optometry 	or 	the 	American 	Optometric
Association. 	The 	proposal 	implies 	that 	it 	is 	deceptive · to 	claim
to 	have 	special 	expertise 	unless 	an 	optometrist 	has 	achieved
formal 	recognition. 	Expertise 	may 	be 	acquired 	through 	training,.
t
even 	though 	it 	does 	not 	lead 	to 	certification, 	or 	through
extensive 	or 	intensive 	practice 	in 	a 	particular 	field. 	The 	Board
may 	appropriately 	reserve 	the 	use 	of 	the 	word 	"specialist" 	to
12

opto~etrists 	satisfying 	certain 	criteria. 	But 	the 	Board 	should
ensure 	that 	such 	criteria 	are 	reasonable 	and 	that 	optometrists
who 	do 	not 	satisfy 	the 	criteria 	may 	nonetheless 	convey 	to 	the
public 	truthful, 	non-deceptive 	information 	about 	their 	training,
experience, 	ability 	and 	the 	nature 	of 	their 	practice. 	We 	ask
that 	the 	Board 	re-examine 	this 	provision 	to 	ensure . that 	it 	does
not 	unnecessarily 	deter 	pptometrists 	from 	conveying 	truthful
information 	to 	consumers.
Fourth, 	Rule 	l(c) 	would 	ban 	any 	statement 	making
unsubstantiated 	price 	comparisons. 	We 	support 	this 	provision
insofar 	as 	it 	would 	require 	comparisons 	to 	be 	truthful. 	But 	this
provision 	could 	be 	construed 	to 	create 	a 	requirement 	that 	such
. ads 	be 	submitted 	to 	the 	Board 	for 	its 	approval 	before 	they 	are
published 	or 	aired . 	If 	this 	is 	the 	intent 	of 	the 	Board, 	we
believe 	that 	the 	requirement 	may 	be 	overly 	burdensome.
Fifth, 	proposed 	Rule 	l(b), 	would 	ban 	all 	promises 	of
guaranteed 	cures, 	which 	may 	be .. too 	broad. 	Such 	a 	rule 	could
discourage 	non-deceptive 	offerings 	of 	guarantees 	o~ 	consumer
satisfaction 	or 	money-back. 	For 	example, 	an 	optometrist 	may 	wish
to 	advertise 	that 	if 	he 	or 	she 	cannot 	correct 	certain 	vision
problems 	to 	20-20, 	all 	fees 	will 	be 	refunded. 	While 	we 	recognize
the 	vulnerability 	of 	consumers 	to 	false 	and 	deceptive 	claims 	of
curative 	results, 	a 	truthful 	communic~tion 	of 	a 	satisfaction
guarantee 	could 	be 	beneficial 	to 	consumers.	,
Finally, 	we 	invite 	your 	attention 	to 	proposed 	section
2113(a)(ll) 	of 	the 	statute, 	which 	would 	permit 	the 	Board 	to
revoke 	or 	suspend 	a 	license 	where 	it 	finds 	an 	optometrist 	guilty
13
. ...

of· 	"soliciting 	in 	person 	or 	through 	an 	agent 	•••. (to 	sell]
ophthalmic 	materials 	or 	optometric 	services, 	or 	employing 	what
are 	known 	as 	'chasers,' 	'steerers,' 	or 	'solicitors' 	to 	obtain
business, 	unless 	in 	conjunction 	with 	a 	vision 	service 	plan
approved 	by 	the 	Board •••• 	" 	This 	provision 	may 	in 	some
instances 	impP.de 	the 	flow 	of 	truthful 	commercial 	information 	from
optometrists 	to 	potential 	patients. 	For 	example, 	it might 	bar
optometrists 	or 	their 	agents 	from 	distributing 	flyers 	or 	from
speaking 	to 	interested 	groups 	about 	ophthalmic 	care. 	A state 	may
legitimately 	insist 	that 	optometrists 	and 	their 	agents 	not 	exert
undue 	influence 	and 	that 	solicitors 	be 	held 	to 	the 	same 	standard
of 	conduct 	as 	the 	professionals 	they 	represent. 	A state 	may 	also
. determine 	that 	a 	past 	pattern 	of 	abuses 	warrants 	regulations
tailored 	to 	prevent 	specific 	abuses, 	but 	a 	blanket 	ban 	on 	the
utilization 	of 	solicitors 	is 	probably 	overly 	broad. 	Therefore,
we 	suggest 	that 	the 	Board 	reevaluate 	the 	need 	for 	such 	sweeping
regulation 	in 	this 	area.
14