Antitrust laws affect the health care field in the context of managed care, mergers and expansions of health facilities, integrated delivery systems and physician participation in joint ventures, among other endeavors. In recent years, federal regulators have aggressively pursued antitrust enforcement actions against physicians while health insurer mergers and business practices generally received minimal scrutiny.
Antitrust laws intend to protect against unfair competition and business practices. Antitrust laws are not meant to protect individual competitors. The key antitrust statues are the Sherman and Clayton Acts. The Sherman Act of 1890 imposes criminal and civil sanctions on participants in concerted or multiparty anti-competitive arrangements, e.g., contracts, combinations and conspiracies that unreasonably restrain trade, and monopolies. The Clayton Act of 1914 prohibits certain actions of independent actors, including price discrimination, tying arrangements, and mergers and acquisitions that have substantially lessen competition. The Clayton Act also allows for private enforcement of and treble damages for violation of either Act. Finally the 1914 Federal Trade Commission (FTC) Act declared “unfair methods of competition” illegal. Antitrust laws are enforced by the Federal Trade Commission (FTC) and the Department of Justice (DOJ). Cases may be analyzed under the strict per se standard, or the more lenient rule of reason.
In general, the following risk factors that may heighten antitrust scrutiny on health care actors:
- Significant market share
- Joint action with other actors
- Denial or limitation of professional privileges of other practitioners, and
- Involvement in a merger, acquisition, joint venture, provider network or other integrated delivery system.
The AMA has worked diligently for years to refocus enforcement initiatives towards the relatively powerful health insurance industry and away from physician ventures. Because these efforts have not yet produced the desired regulatory relief, the AMA strives to educate physicians about the realities of the current antitrust environment so that investigation can be avoided. Visit the links below for further information.
Visit AMA PolicyFinder to search for AMA policies on collective action.
AMA BOT Report "Possible Anti-Competitive and Ethical Implications of Integrated Hospital System Referral Expectations" (A-06)
Litigation Center antitrust cases
Young Physician's Section (YPS) primer on Collective bargaining
DOJ Antitrust Division
FTC Health Care Antitrust Issues