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PubMed1979

The antitrust implications of relative value studies in medicine.

Relative value studies are lists of "relative values" of different professional services. Antitrust enforcement agencies recently have filed several complaints against the promulgation of relative value studies by professional organizations of physicians, alleging that these lists have been used to fix and increase physician fees. This article examines the status of professionally sponsored relative values studies under antitrust law and suggests several reasons why they should be held unlawful. In particular, such relative value studies threaten to eliminate desirable competition among private third-party payers in the development of effective cost-containment strategies as well as among physicians in the setting of fees. Moreover, the alleged benefits of professionally sponsored relative value studies could be achieved by alternative means that do not similarly restrict competition in the provision of medical services.

American Medical Association↗
PubMed1990

Physician unions: any doctor can join, but who can bargain collectively?

Employees in the health care industry, including physicians, have recently taken more interest in unions and collective bargaining. At the present time the health care industry is approximately 20 percent unionized. Labor leaders believe that existing conditions are fertile ground for significant union activity that has been on a recent upswing after a decline during the early 1980s. While current attention is being drawn to the shortage of and increased union organizational activities by nurses, physicians may not be far behind. It is conceivable that by the year 2000 the majority of physicians in the United States will work in full-time salaried positions. In addition, the antitrust laws that currently restrain independent physicians from collective bargaining are being challenged and are likely to change as more physicians become salaried and begin to resemble other professional employee groups. The ruling determining that interns and residents are students rather than hospital employees is also certain to be challenged and changed, especially as pressures on the National Labor Relations Board (NLRB) are brought by house staff union organizations. After a 1987 ruling that the NLRB had been improperly interpreting the 1974 amendments to the Taft-Hartley Act, the NLRB was ordered to exercise its rule-making power in defining bargaining units for health care workers in acute care hospitals. Physicians would then be one of eight occupations defined as a separate health care bargaining unit.

American Hospital Association↗
PubMedDate not supplied

Finding a lasting cure for U.S. health care.

In "Making Competition in Health Care Work" (July-August 1994), Elizabeth Olmsted Teisberg, Michael E. Porter, and Gregory B. Brown ask a question that has been absent from the national debate on health care reform: How can the United States achieve sustained cost reductions while at the same time maintaining quality of care? The authors argue that innovation driven by rigorous competition is the key to successful reform. A lasting cure for health care in the United States should include four basic elements: corrected incentives to spur productive competition, universal insurance to secure economic efficiency, relevant information to ensure meaningful choice, and innovation to guarantee dynamic improvement. In this issue's Perspectives section, eleven experts examine the current state of the health care system and offer their views on the shape that reform should take. Some excerpts: "On the road to innovation, let us not forget to develop the tools that allow physicians, payers, and patients to make better decisions." I. Steven Udvarhelyi; "Health care is not a product or service that can be standardized, packaged, marketed, or adequately judged by consumers according to quality and price." Arnold S. Relman; "Just as antitrust laws are the wise restraints that make competition free in other sectors of the economy, so the right kind of managed competition can work well in health care." Edward M. Kennedy "Biomedical research should be considered primarily an investment in the national economic well-being with additional humanitarian benefits." Elizabeth Marincola.

Cost Control↗
PubMed1997

Physicians find power in unions.

A growing number of physicians are using organized labor to gain economic leverage. Hospital downsizing and autocratic managed-care plans have prompted more doctors to join the ranks of other professionals who carry union cards. While not a sweeping trend, interest in unions is growing--even among private-practice physicians who can't bargain collectively because of antitrust laws.

American Medical Association↗
PubMed1984

Supreme Court upholds exclusive contract in Hyde antitrust decision.

If there is no evidence that a hospital is using market power to "force" its contracting physician upon patients and if the exclusive contract does not adversely affect price or quality, an exclusive arrangement should not violate the federal antitrust laws. These are the insights gained from the decision handed down by the Supreme Court in Hyde (Jefferson Parish Hospital District No. 2 v. Hyde, No. 82-1031).

Anesthesia Department, Hospital↗
PubMed1984

Supreme Court relaxes exclusive contract rules in antitrust decision.

If there is no evidence that a hospital is using market power to "force" its contracting physician upon patients and if the exclusive contract does not adversely affect price or quality, an exclusive arrangement should not violate the federal antitrust laws. These are the insights gained from the decision handed down by the Supreme Court in Hyde (Jefferson Parish Hospital District No. 2 v. Hyde , No. 82-1031).

Anesthesia Department, Hospital↗
PubMed1986

Hospital-physician collaboration and competition: the antitrust connection.

Antitrust issues are surfacing in many kinds of relationships between physicians and hospitals. Although uncertainty still exists regarding the legality of many of these relationships, it is becoming increasingly clear that when a hospital and its medical staff attempt to improve their revenue position at the expense of other providers, the limits of their actions are constrained by antitrust laws. Also, when a hospital competes with physicians, several types of hospital-physician "understandings" could be challenged.

Economic Competition↗
PubMed1985

The changing structure of the health care delivery system in the United States.

The historical equilibrium of the health care industry has been disturbed by recent and radical changes in both the financing of medical services and the structure of the industry. The applicability of antitrust laws to the health field, the use of advertising, and the dismantling of quasilegal barriers, such as certificate-of-need (CON) laws, have made economics of scale and efficiency increasingly important determinants of the size and type of organization delivering health services. Such changes, coupled with those pertaining to the financial incentives facing both patients and providers and emerging excess capacity, have wrought a rapid transformation of the structure of the industry. If hospitals and physicians are to survive, they must be able to anticipate new and increasingly competitive developments. Because competition eliminates cross-subsidies, access to care, especially by the poor, is certain to become more precarious.

Cost Control↗
PubMed1987

An economic analysis of the Maricopa decision.

In Arizona v. Maricopa County Medical Society the United States Supreme Court ruled in a 4-3 decision that the Maricopa Foundation for Medical Care, a nonprofit Arizona corporation, had violated Section 1 of the Sherman Act by engaging in a maximum price-fixing scheme. The Supreme Court in this decision, however, failed to consider the economic impact of the Maricopa Foundation on the cost and quality of health care. The Court's adoption of a per se approach in Maricopa can have a negative impact upon the competition which the antitrust laws are attempting to promote. By focusing only on the narrow aspect of price fixing, the Court ignored (1) the potential of the Maricopa Foundation to contain costs, (2) the potential competitive effect that the foundation may have on third-party carriers and organizations in the marketplace, (3) the relationship of maximum price fixing to economic performance, and (4) the nature of competition in the health care marketplace. This article describes the background of Maricopa as well as the Supreme Court decision. It describes foundations for medical care with special emphasis on the Maricopa Foundation and analyzes Maricopa from an economic rather than the traditional legal perspective, emphasizing how the two perspectives might differ. Attention is paid to the concept of maximum price fixing in the health care marketplace. The concluding section evaluates the Supreme Court decision.

Arizona↗
PubMed1988

Physician recruitment programs--fraud and abuse, tax, and antitrust considerations.

In today's competitive environment, physician recruitment incentive programs perform a valuable function for both hospitals and physicians, but fraud and abuse, tax, and antitrust laws impose significant restrictions on such programs. This article addresses some of the issues that hospitals and physicians must consider before participating in recruitment incentive programs.

Centers for Medicare and Medicaid Services, U.S.↗
PubMedDate not supplied

The medical director as educator: an interview with Elizabeth M. Gallup, MD, JD, MBA. Interview by Richard L. Reece.

Richard L. Reece, MD, interviewed Elizabeth M. Gallup, MD, JD, MBA, on July 9, 1999, to talk about the evolving role of the physician executive. Dr. Gallup discusses how medical directors have evolved from a purely clinical role to participating in the business side of medicine as well. The traditional medical director, a Dr. No who denies treatment and watches clinical performance, is now becoming an educator helping physicians to manage their behavior and change their practices based on comparative data. Her book, How Physicians Can Avoid Surrender and Lead Change: Gaining Real Influence in Your Own Health Care Organization Before It's Too Late, (American College of Physician Executives, 1996) promotes acting together as a group if physicians want to stay independent and not become employed. Independent physicians can form IPAs and act together as a group, avoiding some antitrust laws. Unless physicians get together and act as a group, she says, they are doomed to further and further erosion of their economic interests as well as their clinical autonomy.

Health Maintenance Organizations↗
PubMed2000

Physician unions--an ethical and legal issue in health care delivery.

The controversial issue of physicians' unions has been revived in the past few years by the economic juggernaut of managed care. The uproar of legal and ethical dilemmas surrounding the creation of physician unions centers around self-employed physicians, their formal employment relationship to HMOs under the National Labor Relations Act, and the ramifications of exempting physicians from current antitrust laws. Will physician collective bargaining increase competition and equalize the power between physicians and HMOs so that the quality of patient care improves? This report discusses relevant laws and the history of physicians' unionization, reviews contemporary thought and present policies on physician unionization, and comments on alternatives and new policies that could be created in order to resolve this dilemma.

Delivery of Health Care↗
PubMed1991

Examining exclusionary conduct of HMOs and PPOs: a case comment on Northwest Medical Laboratories v. Blue Cross and Blue Shield of Oregon.

As the climate of the health care industry has changed to one of cost-containment and competition through the growth of HMOs and PPOs, health care providers have become the subjects of antitrust litigation. One such case, Northwest Medical Laboratories v. Blue Cross and Blue Shield of Oregon, involved a medical laboratory and a radiology center who claimed that they were victims of an illegal group boycott after defendant's pre-paid health plan denied them preferred provider status. The Oregon Court of Appeals, using the traditional antitrust analysis applied to other industries for decades, failed to consider the intricacies that exist within the health care industry. This result led to an inaccurate market share computation and an inadequate rule of reason analysis. This Comment examines the shortcomings of the Northwest Medical opinion and argues that, in applying the antitrust laws to the health care industry, courts in future cases must recognize and respect the unique features of the business of providing health care.

Blue Cross Blue Shield Insurance Plans↗
PubMed1988

Vertical restraints among hospitals, physicians and health insurers that raise rivals' costs. A case study of Reazin v. Blue Cross and Blue Shield of Kansas, Inc. and Ocean State Physicians Health Plan, Inc. v. Blue Cross and Blue Shield of Rhode Island.

Two recent district court opinions consider whether affiliations among hospitals, doctors and health insurers--through contract or ownership--violate the antitrust laws. This Article applies a raising rivals' costs framework to the facts of those cases in order to assess whether the practices at issue were unreasonable.

Blue Cross Blue Shield Insurance Plans↗
PubMed1986

Legal implications of home health care by nonprofit hospitals.

Antitrust considerations and other legal implications of home health-care (HHC) services provided by nonprofit hospitals are discussed, and pertinent legal cases are reviewed. Of the various antitrust laws, the act that is probably most relevant to hospital-based HHC is the Section 13C exemption to the Robinson-Patman Anti-discrimination Act, which allows a nonprofit hospital to purchase drugs for its own use at special discounted prices that would otherwise be illegal. For HHC provided by nonprofit hospitals, a major legal question is the extent to which the Section 13C exemption applies to drugs purchased by a hospital at preferential prices and used to treat the hospital's HHC patients; decisions in the cases of Abbott Laboratories et al. v. Portland Retail Druggists Association and De Modena v. Kaiser Foundation Health Plan have helped to clarify the answer to that question. To avoid allegations of illegal tying arrangements, hospitals should take care that users of their HHC services are not being compelled to purchase or use other hospital services unless they would otherwise do so. Also, hospitals providing HHC services should ensure that the professionals providing those services are aware of and meet the appropriate standards of care for the services rendered to avoid liability for negligence. To be successful in the delivery of HHC services, providers will have to be prepared to address the various legal issues that might arise. Hospital administrators, HHC professionals, and legal counsel should work together as HHC programs develop and evolve.

Economic Competition↗
PubMed1983

"Procompetition" and the continuing struggle to contain health-care costs.

Various proposals designed to increase competitive forces in the health-care services economy are discussed. Two concepts inherent in market-oriented strategies for containing health-care costs--cost sharing and fixed-dollar subsidies--are defined. Among the strategies for increasing market forces in health care are (1) increasing consumer choice, (2) increasing consumer cost sharing, (3) modifying tax treatment of insurance and medical care, (4) controlling the terms of employment-based insurance, and (5) application of antitrust law. Specific conceptual and legislative "procompetition" proposals are summarized. All of the "procompetition" proposals offer economic incentives for good management of hospitals as a whole as well as for individual departments such as the pharmacy.

Cost Control↗
PubMed1993

Legal considerations in managed care contracting.

Managed health care systems are created primarily through contracting. Although contracts with managed care organizations, such as health maintenance organizations, are often presented to providers as non-negotiable, this chapter discusses basic contract terms that are frequently negotiated by the parties, including key contract definitions, compensation, term and termination, and "boilerplate" provisions. The chapter also emphasizes the need for contracting parties to conduct precontracting due diligence and to comply with applicable antitrust laws in negotiating contracts with groups of independent providers.

Contract Services↗