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PubMed2005

An analysis of recent antitrust issues affecting specialty practice: is dermatology immune?

In the healthcare industry, the rules of regulation and competition often collide. Despite the view of Medicine as a "learned profession", it is clear that physicians will be subject to the same legal restrictions against sharing price information as those in place for any other industry. Thus, the relevant provisions of antitrust law will apply to most activities of physicians. Although recent case law has involved actions undertaken by physicians in other specialties of Medicine (e.g. oncology) the activities reviewed will likely be applicable to Dermatologists as well.

Antitrust Laws↗
PubMed1995

Playing by the rules: MD groups and antitrust.

Physicians forming networks often find their efforts blocked by state and federal antitrust laws. Yet despite the chilling example of the Marshfield Clinic ruling, physician-driven networks are moving ahead and creating new entities--from Idaho to New Jersey.

Antitrust Laws↗
PubMedDate not supplied

Preserving antitrust.

The forces of organized medicine are arguing for changes in antitrust laws to allow exemptions for physicians. But, given the growing number of provider-sponsored health plans, are such changes necessary?

American Medical Association↗
PubMed2000

The anti-kickback statute standard(s) of intent: the case for a rule of reason analysis.

Mr. Aspinwall presents a comprehensive overview of the anti-kickback statute to show how Congress enacted the legislation to prevent inappropriate utilization and to reduce the ambiguity of the anti-kickback prohibitions by adding a knowing and willful requirement to the standard of intent. He discusses the different lines of caselaw on the anti-kickback standard of intent, and closely examines the standard endorsed by the OIG. He proposes adopting a standard of reasonableness modeled after the rule of reason from antitrust law, using cost-effectiveness as the primary criterion. He argues that a cost-benefit outcomes-based approach to the anti-kickback statute would better serve the public interest.

Antitrust Laws↗
PubMedDate not supplied

Monopoly, monopsony, and market definition: an antitrust perspective on market concentration among health insurers.

James Robinson uses the Herfindahl-Hirschman Index (HHI) to compute the concentration of commercial health insurance markets in most of the states during the past four years. The HHI is the analytical foundation for the federal antitrust merger guidelines, so we consider his findings from an antitrust perspective. Market concentration provides an important benchmark for antitrust analysis, but it does not, standing alone, indicate the presence of problematic (anticompetitive) behavior or a problem that antitrust law can solve. Even if it did, there are major problems in treating individual states as discrete insurance markets. Unless the market is correctly defined, any analysis of market concentration is thoroughly unreliable.

Antitrust Laws↗
PubMed1996

Physician-run health plans and antitrust. American College of Physicians.

As the health care system changes and large managed care entities gain greater control in some markets, proponents of antitrust reform have expressed concern that physicians could lose their autonomy. To respond to this concern, the American College of Physicians has consistently argued that physicians should be allowed to establish their own health plans and networks to provide high-quality and cost-effective care. Moreover, the College has advocated utilization review reform and due process protections to empower physicians in their dealings with insurers. Under current antitrust law, as interpreted by the federal enforcement agencies, physicians already have the legal authority to form their own health plans and networks, and many state medical societies are sponsoring such plans. The law also allows physicians to operate the clinical components of a health plan, regardless of who owns it. Moreover, physicians can share information about quality, utilization, and, in some circumstances, fees. An examination of federal enforcement agency actions since the mid-1970s shows that physician networks have rarely been challenged. In light of market developments, however, the College has urged the federal antitrust agencies to analyze the effect of their current enforcement policies on physician activities and adopt a more flexible approach. Further monitoring and analysis of the changing health care marketplace are necessary to ensure that physicians are being treated fairly and to determine which factors spur or inhibit the development of physician-run health plans and networks.

Antitrust Laws↗
PubMedDate not supplied

Converting new antitrust guidance into action.

The "Statements of Antitrust Enforcement Policy in Healthcare" that were passed in August 1996, represent efforts by the Department of Justice and the Federal Trade Commission to meet health care industry demands for more guidance regarding the application of the federal antitrust laws to the business activities of physicians and provider-sponsored organizations. This article translates the safety zone guidelines into practical language covering the basic requirements, economic integration and clinical integration, the messenger model used in non-integrated networks, and the implications for physician group practices.

Antitrust Laws↗
PubMedDate not supplied

Antitrust implications of alternative delivery systems.

Collaborative arrangements between clinical labs have created new opportunities for market development and the efficient delivery and production of services. As with any joint effort between otherwise competing entities, however, these arrangements are subject to federal and, some cases, state antitrust laws designed to ensure that the market performs in the most efficient way possible, a result believed best achieved through the preservation of competition. As a result, both the formation and operation of the new arrangement will be analyzed to ensure that its anticompetitive effects, if any, are minimal and are outweighed by the arrangement's procompetitive efficiencies. At the formation stage, the new entity will be analyzed to determine whether the participants would be able to exercise market power, which, in antitrust jargon, means the ability to raise prices above the competitive level. At the operational stage, the new entity will be analyzed to determine whether agreements among participants, primarily agreements on price, are necessary for the efficient operation of the new enterprise. This article addresses these basic antitrust principles.

Antitrust Laws↗
PubMed1991

Economic analysis in health care antitrust.

The Federal Trade Commission (FTC or Commission) has been very active in enforcing antitrust laws in the health care field for the past two decades. The staff has investigated a wide variety of cases covering a broad range of restrictions on competition. These cases can be divided into three basic types of cases in health care: (1) mergers and acquisitions, (2) horizontal restraints cases or agreements among competitors, and (3) input market monopolization cases, such as hospital privileges cases. The Commission relies on both legal and economic analysis in all of these cases. As Chairman Steiger of the Federal Trade Commission has stated, antitrust policy has been "increasingly reshaped by analysis based on economic theory." This article attempts to explain the economic analysis used in antitrust enforcement as applied to the first two of the three types of health care cases. Section I presents the basic economic framework that is used to assess the competitive implications of health care mergers and acquisitions. Section II describes the analysis applied to other agreements among competitors in the health care field and briefly explains how this analysis differs in other health care cases.

Antitrust Laws↗
PubMed1993

The impact of health-care reform on the cancer patient.

Reform of the United States' health-care system as we know it will require a reevaluation of the methods used in health-care delivery. Many changes are emerging in the health-care marketplace, and there is a prevailing trend toward universal coverage through managed care/competition. Global cost-control measures will become more prevalent, as we have seen already in the Clinton Administration's plan to become the sole and price-controlling customer for all childhood vaccines. Health-care delivery is evolving toward local care networks involving managed competition, a system in which patient groups will trade volume for price. Legal barriers presently include antitrust laws, which restrict collaboration among health providers, fraud and abuse laws, and tax considerations. Licensure and regulatory issues also may have an impact on reforms. The benefits most likely will include guaranteed health care, reduced health-care costs, and a better, more efficient quality of medical care. With these changes, however, there will be less freedom of choice in health care and a greater burden on certain sectors of the economy.

Antitrust Laws↗
PubMed1992

Mergers thrive despite wailing about adversity.

A push is under way to reform federal and state antitrust laws to permit more collaborative hospital activities. The intent of such reform is to ensure that cost-cutting, quality-enhancing joint projects aren't hampered by federal or state restrictions. But much evidence indicates that hospitals have done just about anything they've wanted in terms of collaboration, and they've done it a lot in the past few years.

American Hospital Association↗
PubMed2003

Relevance of federal antitrust statutes to clinical practice.

With the advent of Medicare prospective payment systems, health care entities and physicians were forced to decrease expenses by sharing services and to increase revenue by attempting to jointly negotiate better reimbursement from third- party payers. Both activities have raised the specter of prosecution under antitrust laws that have been with us for more than a century but are poorly understood by practicing physicians. Recent monopolistic activities in the health care arena have prompted the Federal Trade Commission to file actions under specific acts of Congress, eg, the Sherman Anti-Trust Act, Clayton Act, Federal Trade Commission Act, Robinson-Patman Act, and Celler-Kefauver Act. Inasmuch as it is likely that specialties such as vascular surgery as a business will undergo substantial transformation, physicians need to be aware of the severe civil and criminal sanctions imposed if they are found guilty; fines that are several times actual damages; activities that raise antitrust issues including utilization review, medical staff privileges for competing specialties, participating provider agreements, and predatory pricing; and affirmative defenses and relief available in terms of specific exemptions. As health care providers react, innovate, and adjust to stay solvent, their business strategies will surely continue to be scrutinized for antitrust behavior by federal and state officials. The physician must have a basic understanding of the groundrules that govern any contemplated business strategy so that common pitfalls may be averted.

Antitrust Laws↗
PubMed1997

Not-for-profit status facilitates hospital merger.

Not-for-profit status may become an advantage for hospitals seeking to increase market share through a merger. On July 8, 1997, the Court of Appeals for the Sixth Circuit upheld the District Court's denial of a request by the Federal Trade Commission (FTC) to halt a proposed merger between two not-for-profit hospitals, Butterworth Hospital and Blodgett Memorial Medical Center, both in Grand Rapids, Michigan. The FTC had requested the District Court to enjoin the merger until the agency could determine whether it was in violation of Federal antitrust laws. The District Court was persuaded that mergers of not-for-profit hospitals do not generally lead to price increases, and may, in fact, lead to price reductions. Moreover, because the Michigan not-for-profit hospitals' boards included community representatives who were purchasers of the hospitals' services, the court found that "there would be no rational economic incentive for such an organization to raise its prices."

Antitrust Laws↗
PubMed1996

How PHOs can avoid price-fixing charges.

Last fall, the U.S. Department of Justice (DOJ) sent the message to PHOs that when negotiating with third parties, they need to be careful not to break antitrust laws, or they could face heavy monetary damages--or even criminal liability. In settlements with PHOs in Danbury, Connecticut, and St. Joseph, Missouri, the DOJ said that PHOs could not become involved in pricing decisions unless they acted in one of two ways: as a qualified managed care plan in which providers share financial risk or as a messenger between providers and third parties. The two cases show how networks may and may not engage in negotiations with payers.

Antitrust Laws↗
PubMed1999

Physician unionization efforts gain momentum, support.

Physicians increasingly are assuming the status of employees in healthcare organizations. Physicians also are seeing restrictions imposed on their practices by healthcare organizations seeking to control costs of care delivery. These trends have led a growing number of physicians to attempt to organize into unions. Obstacles to physician unionization efforts have included Federal antitrust laws that prohibit physicians from organizing, as well as physician reluctance to engage in organized activities they see as antithetical to their professional duties (e.g., strikes). In addition, physicians' attempts to unionize frequently have failed due to provisions of the National Labor Relations Act, which authorize collective bargaining only among individuals designated as "employees." Physicians seeking to form unions often are thwarted by the argument that they are not employees, but rather students, independent contractors, or supervisors, and therefore not entitled to protection under the act. Nonetheless, a number of recent developments, such as the American Medical Association's decision to endorse unionization by physicians and the National Labor Relations Board's decision that attending physicians should be regarded as employees, not supervisors, are creating a climate more conducive to physician unionization in the United States.

Antitrust Laws↗
PubMed1991

A competitive analysis of most favored nations clauses in contracts between health care providers and insurers.

A most favored nations (MFN) clause is a contractual agreement between a buyer and a seller stating that the price paid by the buyer will be at least as low as the price paid by other buyers who purchase the same commodities from the seller. During the past decade the anticompetitive impact of MFN clauses in the health care industry has been challenged under federal antitrust laws. The cases have considered MFN clauses included in contracts between large third-party payers, specifically Blue Cross and Blue Shield (BCBS) plans, and providers of health care. The clauses prohibit providers from selling their medical services to BCBS's competitors at a price lower than the price at which they sell to BCBS. The cases have challenged these clauses on the grounds that they limit selective discounting to the competitors thereby making it difficult for the competitors to attract subscribers from dominant BCBS plans by lowering premiums. In this Article, Professor Celnicker asserts that MFN clauses have significant anticompetitive potential. The Article examines the competitive consequences of MFN clauses used in the health care industry. The Article's analysis draws heavily from the economic criticisms of the Robinson-Patman Act, which prohibits a seller from discriminating in price between customers in certain circumstances. The Article concludes that in certain circumstances, MFN clauses discourage discounting, facilitate oligopolistic pricing, and deter entry or expansion by more efficient distribution systems.

Antitrust Laws↗
PubMed1985

Antitrust aspects of exclusive contracts in medical imaging.

Exclusive contracts between radiologists and hospitals may be more frequently scrutinized for antitrust violations because of the Hyde v Jefferson Parish Hospital District No. 2 case. In the Hyde case, the lower court decided antitrust law had been violated, and it was the first antitrust case about exclusive medical contracts to be reviewed by the U.S. Supreme Court. The case is a precedent for considering similar circumstances according to traditional business antitrust analyses such as per se violations, tying arrangements, group boycott, and market foreclosure. Areas that may be scrutinized for anticompetitiveness include hospital privileges when radiologists have exclusive contracts with the community's only hospital or provide services unique within an area, and physicians' access to scarce resources (e.g., computed tomography [CT], magnetic resonance [MR] imaging). Radiologists must understand antitrust implications of their hospital contracts; examine the terms of staff appointment, bylaws, and rights; and be able to guide their attorneys through contract negotiations.

Contract Services↗