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Health Antitrust Litigation Update for Providers | 2020

In 2019, the total number of antitrust cases filed against providers dropped to 20 after the 2018 bump (27 cases). In the latest Health Antitrust Litigation Update for Providers, we discuss what kinds of cases were brought over the past two years and how they were decided, and what cases warrant particular attention in 2020. Read the full report.

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The Latest: Health Care Transactions Will Require Advance Notice to Washington State AG

What Happened: On May 7, 2019, Governor Jay Inslee of Washington State signed House Bill 1607 into law. The law goes into effect for transactions closing after January 1, 2020, and requires advance notice to the Washington Attorney General (AG) of certain transactions 60 days in advance of closing the transaction. The intent of the law is “to ensure that competition beneficial to consumers in health care markets across Washington remains vigorous and robust[.]” Parties must file written notice with the AG for any deal that involves two or more hospitals, hospital systems, or other provider organizations that represent seven or more health care providers in contracting with insurance companies or third-party administrators. A “provider” includes a physician, nurse, medical assistant, therapist, midwife, athletic trainer, home care aide, massage therapist, among others. The law can apply to transactions involving very small medical groups, as long as there are...

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Antitrust Enforcement Update: Spotlight on Physician Transactions

At both the state and federal level, antitrust enforcement agencies continue to pursue successful challenges to physician practice transactions. This article summarizes two recent enforcement actions, as well as a new state law that requires prior notice of healthcare provider transactions. We also offer practical takeaways for providers pursuing practice acquisitions. Access the full article.

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Antitrust Litigation Update for Health Care Providers

2018 saw a significant upswing in antitrust litigation against health care providers; 27 cases were filed in 2018 versus 17 in 2017. In the latest Antitrust Update for Health Care Providers, we discuss what caused the notable rise, what kinds of cases were brought over the past two years and how they were decided, and what cases warrant particular attention in 2019. Access the full report.

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THE LATEST: DOJ Announces Settlement with Carolinas Health System (Atrium Health) After Two Years of Litigation

The Department of Justice (DOJ) announced last week that it and the State of North Carolina have reached a settlement with Carolinas Healthcare System / Atrium Health relating to provisions in contracts between the health system and commercial insurers that allegedly restrict payors from “steering” their enrollees to lower-cost hospitals. The settlement comes after two years of civil litigation, and serves as an important reminder to hospital systems and health insurers of DOJ’s continued interest in and enforcement against anti-steering practices. WHAT HAPPENED: On June 9, 2016, the DOJ and the State of North Carolina filed a complaint in the Western District of North Carolina against the Charlotte-Mecklenburg Hospital Authority, d/b/a Carolinas Healthcare System, now Atrium Health (Atrium). In its complaint, DOJ accused Atrium of “using unlawful contract restrictions that prohibit commercial health insurers in the Charlotte area from offering patients...

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THE LATEST: Washington Attorney General Seeks Disgorgement of Profits Resulting from Two Transactions between Health System and Physician Groups

On August 31, 2017, the Attorney General of Washington filed a complaint in the United States District Court for the Western District of Washington alleging that two transactions harmed competition for healthcare on the Kitsap Peninsula. WHAT HAPPENED: In July 2016, CHI Franciscan Health System (Franciscan) acquired WestSound Orthopedics (WestSound), a physician practice of seven orthopedists based in Silverdale, Washington. In September 2016, Franciscan entered into a set of agreements which allowed The Doctors Clinic (TDC), a 54 physician multispecialty practice also based in Silverdale, to use Franciscan’s reimbursement rates with payors in exchange for certain ancillary services. While the publicly stated rationale for the transactions included “enhanced patient access and efficiency,” the Attorney General’s complaint alleged that the “true motivation” for the deals was to “charge higher rates for physician services, and to collectively gain negotiating...

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FTC Hosts Public Workshop, “Examining Health Care Competition”

During the last several years, the Federal Trade Commission (FTC) has taken an active role in antitrust enforcement in the health care industry, particularly with respect to hospital and physician group acquisitions.  Last week, the FTC held a two-day public workshop to examine new trends and developments in the health care industry related to professional regulations of health care providers, health information technology, new care delivery models, quality measurements and pricing transparency and how those developments may affect competition.  Health care providers should anticipate increased FTC scrutiny of these trends and how they affect health care costs, quality, access and care coordination. Click here to read the full article.

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Court Orders Divestiture of Consummated Physician Practice Acquisition

In a challenge brought both by private plaintiffs and the government, a court has ruled that a health system’s acquisition of a competing physician group practice violated the antitrust laws where the transaction resulted in the health system employing 80 percent of the primary care physicians in one area.  Hospitals and health systems pursuing physician practice mergers should carefully consider the implications of this decision on proposed acquisitions and should incorporate antitrust due diligence into their transaction planning. Click here to read the full article.

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Healthcare Provider Fees May Constitute Kickbacks Even Without Direct Referrals

In a recent advisory opinion, the Department of Health and Human Services inspector general warned health care providers about entering into contracts that may generate illegal kickbacks and result in administrative penalties.  An unnamed anesthesiology provider requested advice regarding a proposed contract with an in-hospital psychiatric service.  Currently, the anesthesiology provider is the exclusive provider of anesthesia services to a hospital, with the exception of the in-house psychiatric service, which uses its own provider.  Prior to 2011, the anesthesiology provider was the exclusive provider for the hospital, including psychiatric services.  In December 2010, however, the psychiatric service relocated its practice to the hospital and negotiated for the right of its anesthesiologist to offer services to its patients, thus eliminating the anesthesiology provider’s exclusivity contract for psychiatric care. Under the proposed arrangement, the...

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