Saturday, December 30, 2006

When will this madness end?

The FTC put out a press release yesterday that announces a proposed consent decree in the case of "several organizations representing more than 2,900 independent Chicago-area physicians for agreeing to fix prices and for refusing to deal with certain health plans except on collectively determined terms. The FTC’s complaint charges that the actions of Advocate Health Partners (AHP) and other related parties unreasonably restrained competition in violation of Section 5 of the FTC Act. The consent order settling the FTC’s charges will prohibit the respondents from engaging in such anticompetitive conduct in the future." Here's some of the detail:

The FTC’s complaint challenges conduct during the period 1995 to 2004, during which the respondents collectively negotiated the prices and other contract terms at which their otherwise competing member physicians would provide services to the subscribers of health plans, without any efficiency-enhancing integration of their practices sufficient to justify their conduct. In particular, for a period of time AHP staff negotiated contracts on behalf of each PHO respondent, with each PHO respondent retaining authority to approve offers and counteroffers.Subsequently, AHP was given the authority to approve offers and counteroffers and, ultimately, to approve negotiated contracts on behalf of the AHP physicians, who could then opt in or out of the negotiated contract.

The complaint also alleges that in 2001, AHP terminated its members’ contracts with a health plan that rejected contract proposals for higher fees, and threatened that it would not contract with the plan for hospital services unless it stopped contracting with individual physicians and agreed to a group contract. The resulting contract included fees 20 percent to 30percent higher than the health plan’s individual physician contracts.

The full case file for In re Advocate Health Partners et al., No. 0310021, is here. The proposed consent decree is available for public review and comment before the Commission decides whether to make it final.

This is, by my rough count, the 22nd price-fixing/boycott case brought against physicians and/or physician groups or their representatives by the FTC since 2002 for similar or in some cases identical conduct. You can read all about them in the useful "Overview of FTC Antitrust Actions in Health Care Services and Products (Aug. 2006)."
posted by tommayo, 11:23 AM

Health care law (including public health law, medical ethics, and life sciences), with digressions into constitutional law, poetry, and other things that matter