Trust and Antitrust: Time for Physicians to Get Involved

Commentary: As health care acquisition legal stories are being brought to our attention, it is time doctors get more involved and assume a front-row position in such dialogues.

In his discussion article, P. Dileep Kumar, MD, FACP, CPE, touches on and gives a brief historical review of the antitrust laws and their complex relationship with health care industries.1 It is long overdue to bring up such information.

EXPERT'S PERSPECTIVE

THE STORY: The effect of antitrust laws in health care is changing with the rapid evolution of the industry. Mergers and acquisitions are common, but federal authorities have acted against them on behalf of consumers. Meaningful reform is on the horizon, and physician leaders should play a role in this process. Click here to read it.

ON THIS PAGE: Mousa A. Al-Abbadi, MD, CPE, FCAP, FIAC, CPHQ, ABMQ, a member of the Physician Leadership Journal editorial board, comments on the article.

The American economy is one of the largest enterprises in the world and many believe the U.S. economy is essentially successful and highly infectious to others.2 Therefore, many nations are continuously evaluating U.S. macro- and microeconomics with particular emphasis on our regulations.

The free capitalistic economy, with its wide-ranging variations, needs a certain degree of oversight and control, regardless of their intensity and degree.

The antitrust laws in the United States started in the 19th century with an objective to protect small businesses, entice fair competition and ultimately serve the best interest of customers.3,4,5 From the Sherman Antitrust Act in 1890 followed by Clayton Antitrust Act in 1914; the snowball effect started culminating in the establishment of the Federal Trade Commission with its subsequent acts. Although these regulatory standards were purely business-oriented; the health care industries — with its sizable gross domestic product share — were to be affected.

Monopoly and oligopoly are also critical issues, affecting all facets of the health care delivery system, and dealing with these important problems early on is essential.6 The merger and consolidation of large numbers of health care organizations is on the rise, and these new changes are affecting our health care delivery models from many angles. Changes in the health care systems are evolving in dramatic speed, necessitating serious attention. The Affordable Care Act and the antitrust laws are also related issues and were briefly addressed in this article.1,3,5

While mergers and consolidations between many health care providers are thought to be more effective health care institutions, it also remains to be seen if these changes have an impact on the quality of health care delivery.2 Whether these recent mergers and consolidations have a negative or positive net effect on the quality of health care at the individual patient level is still debatable.6,7 The “efficiency defense” as a concept is becoming an essential part of many arguments in recent court cases dealing with these merges.8 As the cost of good quality health care for consumers is on the rise, can we still provide same or even-better quality medicine while moving toward more efficient health care models using mergers and consolidation of services as a tool?

These questions and many others are continuously being raised and discussed in depth and details. Such discussions and awareness in the era of evidence-based medicine are essentially healthy and desirable for all the stakeholders in the business of health care delivery.8 As we go toward more personalized medicine; the big question is, “Can these changes and trends in health care delivery be achievable and consequently sustainable?”

The Federal Trade Commission and the Department of Justice are the main federal agencies that deal with these critical regulatory issues, and their collaboration is critical.1,9 The fine balance between the creation and implementation of more regulations while keeping effective, high-quality and safe health care delivery is an arduous task.

On one hand, we need to make sure that greed and fraud are as small as possible while maintaining the spirit of free market economy in health care delivery. Despite the complexity of these elements and the speed of changes that are happening in health care delivery systems, this article provides a brief overview of the federal antitrust laws in the United States and the related evolving trends.1

Kumar also provides a timeline of these antitrust laws, starting with the Sherman Antitrust Act in 1890 up with the United acquiring DaVita story from Denver, Colorado. The “story-telling” style of some of these actual legal cases in this article is enjoyable and informative. From Colorado to Massachusetts passing through Illinois and Ohio, health care acquisition legal stories are being brought to our attention.10-20

The author concludes that meaningful legislative reforms are also evolving and physicians and health care providers should be in the trenches and deeply involved. Indeed, it is time physicians get more involved and assume a front-row position in these dialogues. Doing so, the question that will always arise: Can we still have enough time to enjoy having a reasonable “quality chat” with our customer, the patient? Yes, we can — we just need good time management skills.

Mousa A. Al-Abbadi, MD, CPE, FCAP, FIAC, CPHQ, ABMQ, is a member of the Physician Leadership Journal editorial board, and a professor of pathology and cytopathology in the Department of Pathology in the School of Medicine at the University of Jordan.

REFERENCES

1. Kumar PD. Antitrust laws: evolving trends. Physician Leadership Journal 2019;May/June 2019.

2. Emery DW. Global theory and the nature of risk, Part I. How orthodox managed care stifles innovation. Physician Exec. 1999 May-Jun;25(3):36-42.

3. United States v. Carilion Health Service, 707 F. Supp. 840 (W.D. Va. 1989). Justia US Law. Accessed at https://law.justia.com/cases/federal/district-courts/FSupp/707/840/1574626/ on Aug. 1, 2018.

4. Health information & the law. What is antitrust and why is it relevant to health care? August 2014. Accessed at www.healthinfolaw.org/lb/download-document/5819/field_article_file on July 31, 2018.

5. Groebe CZ. The evolution of federal courts’ healthcare antitrust analysis: Does the PPACA spell the end to hospital mergers? Washington University Law Review. 2015. Volume 92, Issue 6, page 1617.

6. Federal Trade Commission and Department of Justice. Antitrust guidelines for collaborations among competitors. Accessed at https://www.ftc.gov/sites/default/files/documents/public\_events/joint-venture-hearings-antitrust-guidelines-collaboration-among-competitors/ftcdojguidelines-2.pdf on July 31, 2018.

7. United States Court of Appeals for the Sixth Circuit. Promedica Health System v. Federal Trade Commission. Accessed at http://www.opn.ca6.uscourts.gov/opinions.pdf/14a0083p-06.pdf on Aug. 1, 2018.

8. Saint Alphonsus Medical Center, Nampa; Treasure Valley Hospital Limited Partnership, Saint Alphonsus Health System and Saint Alphonsus Regional Medical Center v. St. Luke's Health System and St. Luke's Regional Medical Center. Federal Trade Commission; state of Idaho, plaintiffs, v. St. Luke's Health System; Saltzer Medical Group, defendants. Accessed at https://caselaw.findlaw.com/us-9th-circuit/1691791.html on July 1, 2018.

9. Goldberg C. Another historic health care move in Boston: Saying no to biggest hospital system. CommonHealth. Jan. 30, 2015. Accessed at http://www.wbur.org/commonhealth/2015/01/30/massachusetts-hospital-system-rejected on Aug. 1, 2018.

10. Rege A. NorthShore University Health System, Advocate Health Care scrap merger agreement. Becker’s Hospital Review. March 07, 2017. Accessed at https://www.beckershospitalreview.com/hospital-transactions-and-valuation/northshore-university-healthsystem-advocate-health-care-scrap-merger-agreement.html on Aug. 1, 2018.

11. Japsen B. AMA says regulators should block CVS-Aetna deal. Forbes. Jun 19, 2018. Accessed at https://www.forbes.com/sites/brucejapsen/2018/06/19/ama-says-regulators-should-block-cvs-aetna-deal/#31a997d4c7ff on Aug. 1, 2018.

12. Haefner M. FTC asks for more information on Optum's takeover of DaVita. Becker’s Hospital Review. March 22, 2018. Accessed at https://www.beckershospitalreview.com/hospital-transactions-and-valuation/ftc-asks-for-more-information-on-optum-s-takeover-of-davita.html on Aug. 1, 2018.

13. Federal Trade Commission. The antitrust laws. Accessed at https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/antitrust-laws on July 30, 2018.

14. Kopel DB, Bast J. Antitrust’s Greatest Hits. Reason. November 2001. Accessed at https://reason.com/archives/2001/11/01/antitrusts-greatest-hits on Aug. 1, 2018.

15. Crampton L. What’s on deck for antitrust in 2018? Bloomberg Law. Jan. 2, 2018. Accessed at https://biglawbusiness.com/whats-on-deck-for-antitrust-in-2018/ on Aug. 1, 2018.

16. Fleishon HB, Itri JN, Boland GW, Duszak R Jr. Academic Medical Centers and Community Hospitals Integration: Trends and Strategies. J Am Coll Radiol. 2017 Jan;14(1):45-51. doi: 10.1016/j.jacr.2016.07.006. Epub 2016 Nov 1. PubMed PMID:27815052.

17. Taylor D, Kleiner BH. New developments in a consolidating health care industry. Health Manpow Manage. 1998;24(2-3):66-8. PubMed PMID: 10346310

18. Bjorklund JL. St. Alphonsus Medical Center v. St. Luke Health System: The uncertain application of the efficiencies defense is leading to unpredictable outcomes in healthcare mergers. Accessed at https://www.uidaho.edu/-/media/UIdaho-Responsive/Files/law/law-review/articles/volume-53/53-3-bjorklundjamie.ashx?la=en&hash=751676666B308B327803885722F3F6F5D5EAB2D4 on Aug. 1, 2018.

19. Hammer PJ, Sage WM. Critical issues in hospital antitrust law. Health Affairs 2003. Vol. 22, No. 6. Accessed at https://www.healthaffairs.org/doi/full/10.1377/hlthaff.22.6.88 on July 31, 2018.

20. Supreme Court of the United States. Federal Trade Commission v. Phoebe Putney Health System, et al. Accessed at https://www.supremecourt.gov/opinions/12pdf/11-1160\_1824.pdf on Aug. 1, 2018.