Federal antitrust exemption, state laws combine to protect insurers.
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Although instrumental in ushering in competition to the health care industry and later in safeguarding the competitive structure of markets, antitrust law has come under attack. A series of questionable judicial decisions has clouded the standards applicable to analyzing health care markets. Legislative efforts to immunize conduct from antitrust challenge also have gathered support in recent years. This study finds scant economic or policy basis for these developments and concludes that anti-managed care sentiments have diluted enthusiasm for applying competitive principles in health care. This phenomenon has resulted in outcome-driven judicial decisions and legislative activity geared to serving political expediency rather than sound policy tenets. The paper recommends heightened antitrust scrutiny of provider and insurer markets by federal and state enforcers and increased empirical research into the workings of imperfect health care markets and the effects of past antitrust decisions.
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Health care market reform is moving at a rapid pace across the United States. Providers, payers, and government are all developing policies and programs to fit into a new scheme that is taking shape as managed health care. With the changes come a series of challenges and consumer concerns, including choice of health care providers, treatment options, and health plans; access to a full range of providers; and lack of information on quality of care. Legislative bodies have responded with proposals such as "any willing provider" laws and expansion of antitrust exemptions, which are likely to have even more negative consequences on market reform. Health Policy Corporation of Iowa (HPCI) makes a series of recommendations to ensure effective health care market reform.
Courts often uphold hospital credentialing decisions based in part on economic criteria. Nonetheless, as this article discusses, arrangements where medical staff privileges or other benefits appear to be offered to physicians as an incentive to refer patients may be suspect under the Medicare/Medicaid fraud and abuse law.
The joint antitrust enforcement statement for physician networks was designed in part to dispel uncertainty in the physician community about antitrust agency law enforcement intentions. In the two years since its issuance, the antitrust agencies have generally, but not always, been consistent in applying the methodology and standards set forth in their enforcement statement. Even though agency pronouncements like the enforcement statement are not binding on private parties or the federal courts, both the statement and subsequent advisory opinions and business review letters have been exceptionally helpful, if not always encouraging, to health care providers in their antitrust planning efforts.
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