Health Care and Competition Law and Policy

September Topics

The Antitrust Division and the Federal Trade Commission are cohosting hearings on health care and competition law and policy. This page provides details on topics for the September hearings.

For more information, consult the hearings information page or contact David Kelly, Litigation I Section (david.kelly@usdoj.gov or 202-616-9447).

September 24, 2003

Morning Session
Physician Product and Geographic Market Definition

Questions for consideration:

• How should the relevant product and geographic markets for physician services be defined and measured?
• How do quality and reputation affect product market definition and competition?
• How common is price variation among physicians providing comparable services in any given market?
• To what extent do patients and payors factor price variation into their decision-making?
• How, if at all, does integration allow physicians to exercise market power or constrain them from doing so?
• What are the barriers to entry in physician markets?
• Do these barriers vary in different geographic markets or at different points in a physician’s career?
• What evidence, if any, indicates that physician concentration and price are related?
• How does managed care penetration, individual practice association (IPA) participation, physician concentration, and other factors affect physician reimbursement?

Panelists:

• David Argue, Economists, Inc.
• Howard Feller, McGuire Woods, LLP
• Margaret Guerin-Calvert, Competition Policy Associates, Inc.
• Astrid Meghrigian, California Medical Association
• Monica Noether, Charles River Associates
• John Wiegand, Federal Trade Commission

Afternoon Session
Physician Information Sharing

Questions for consideration:

• What kinds of information (both price and non-price) are physicians who provide services in separate practices sharing (1) among themselves; (2) with payors; and (3) with others such as employer organizations, public interest groups and the media?
• Under what circumstances, if any, does such information sharing pose an unacceptable risk of competitive harm?
• What forms of aggregation might permit the sharing of pricing data and other information among competing physicians, without facilitating tacit or explicit coordination?
• What, if any, are the potential procompetitive benefits and anticompetitive risks of physician surveys of price, payor reimbursement amounts, and non-price information?
• What, if any, are the likely effects on physician competition of the recent business review letter issued by the DOJ and the advisory opinion issued by the FTC regarding such sharing of information in Washington and Dayton, respectively?
• What steps have providers taken to reduce the risk that their collective sharing of price or non-price information with payors or others might raise antitrust concerns?

Panelists:

• Gregory G. Binford, Benesch, Friedlander, Coplan & Aronoff LLP
• Roxane Busey, Gardner Carton & Douglas
• Robert Leibenluft, Antitrust Coalition For Consumer Choice in Healthcare
• Robert E. Matthews, PriMed Physicians
• Additional panelist to be announced

September 25, 2003

Morning Session
Physician IPAs: Patterns and Benefits of Integration

Individual practice associations (IPAs) are groups of independent physicians that contractually form a physician network joint venture that can contract with insurance plans. IPAs can integrate financially, clinically, or both. Some IPAs have adopted common medical protocols and made other efforts to clinically integrate. Other IPAs focus on contractually sharing risk, and devote minimal attention to clinical integration.

Questions for consideration:

• Does one structural or contractual form of IPAs predominate in the market?
• Are differences in organizational structure and function related to geographic location, specialty, or other factors? For example, are multi-specialty IPAs structurally or functionally different than single-specialty IPAs?
• What are the regulatory and economic constraints on IPAs?
• Do IPAs enhance efficiency and quality?
• What types of clinical and financial integration have IPAs adopted?
• What, if any, strategic advantages do IPAs offer independent physicians, and how do these organizations affect the clinical and financial decisions of participating physicians?

Panelists:

• Bartley Asner, MD, California Association of Physician Groups
• Lawrence Casalino, M.D., University of Chicago
• Curt R. Hawkinson, American Association of Physician Assistants
• Albert Holloway, The IPA Association of America
• Markus H. Meier, Federal Trade Commission

Afternoon Session
Physician IPAs: Messenger Model

The messenger model has attracted considerable criticism from health care providers.

Questions for consideration:

• What is the basis for that criticism?
• How prevalent and functional are the messenger model arrangements set forth in the 1996 Statements of Antitrust Enforcement Policy in Health Care jointly issued by the DOJ and FTC?
• What improvements could be made to those arrangements without increasing the risk of competitive harm?
• What approaches or methods could providers use as efficient alternatives to the messenger model arrangements described in the Health Care Policy Statements?
• How timely and effective has Agency intervention been with regard to anticompetitive IPA conduct?

Panelists:

• David Marx, Jr., McDermott, Will & Emery
• Jeff Miles, Ober, Kaler
• Richard D. Raskin, Sidley & Austin
• Douglas C. Ross, Davis, Wright & Tremaine, LLP
• Additional panelist to be announced

September 26, 2003

Morning Session
Physician Unionization

Many employed physicians and other allied health care service providers are unionized. Expanding the scope of physician unionization to include non-employee physicians has been proposed to address disparities in bargaining power between payors and providers.

Questions for consideration:

• What is known about the effects of unionization, if any, on the cost, quality, and availability of health care to consumers?
• Does collective negotiation focus on enhanced quality, higher salaries/prices for the services that are being provided, or both?

Panelists:

• Carl Ameringer, University of Wisconsin
• William Brewbaker, University of Alabama, School of Law
• Mark Flaherty
• Michael Connair, MD, Federation of Physicians and Dentists
• Additional panelist to be announced

Afternoon Session
Group Purchasing Organizations

The hospital group purchasing organization (GPO) industry is currently in a state of flux as individual GPOs begin to modify their membership requirements and contracting practices in response to recent Congressional and public criticism.

Questions for consideration:

• Given the recent changes, what current practices or attributes of the industry, if any, raise legitimate antitrust concerns?
• In particular, how prevalent are bundling of products, lengthy manufacturer/GPO sole source contracts, and high hospital/GPO commitment contracts?
• Does the analysis of Health Care Policy Statement 7 on joint purchasing arrangements remain valid, or should it be modified?
• In particular, should the safety zone provision in Health Care Policy Statement 7 for purchases that account for less than 35 percent of the total sales of the purchased product or service in the relevant market be modified?
• What, if any, are the circumstances under which bundling is anticompetitive or procompetitive?
• What is the proper approach for determining whether the term of a particular manufacturer/GPO sole source contract is sufficiently long to, on balance, harm competition rather than promote it?

Panelists:

• Robert E. Bloch, Mayer, Brown, Rowe & Maw
• Lynn James Everard
• Gary Heiman, Standard Textile
• Said Hilal, Applied Medical Resources Corporation
• Merrile Sing, Government Accounting Office
• John W. Strong, Consorta, Inc.
• Elizabeth Weatherman, Warburg Pincus

September 30, 2003

Morning Session
International Perspectives on Health Care and Competition Law and Policy

A number of countries other than the United States have grappled with the application of competition law and policy to health care.

Questions for consideration:

• How do other countries apply competition law to their systems for the coverage and delivery of health care services?
• What, if any, is the applicability of those experiences to U.S. competition law and policy?

Panelists:

• Sitesh Bhojani, Commissioner Australian Competition & Consumer Commission
• Bruce Cooper, Australian Competition & Consumer Commission
• Michael Jacobs, DePaul Law School
• Dr. Liu, Len-Yu, Fair Trade Commission
• Declan Purcell, Irish Competition Authority

Afternoon Session
Medicare and Medicaid

Medicare and Medicaid are major purchasers of health care services. For certain populations and illnesses, they are the sole purchaser of services, and their actions have spill-over effects on the rest of the market.

Questions for consideration:

• How should the government’s roles as regulator and purchaser of health care services be reconciled?
• How can the government utilize its purchasing power to encourage the disclosure of information and make health care coverage and delivery markets more efficient?
• What, if any, are the limitations on the government’s ability to employ its purchasing power in this fashion?
• What steps, if any, should the government take or avoid so that its purchasing power does not harm consumers and competition?

Panelists:

• Joe Antos
• Joseph A. Cashia, National Renal Alliance, LLC
• Dan L. Crippen
• Walton Francis
• Jeff Lemieux, Progressive Policy Institute
  

October 1, 2003

Morning Session
Remedies: Civil/Criminal

Health care antitrust violations, like other antitrust violations, can be addressed through both civil and criminal enforcement proceedings.

Questions for consideration:

• With respect to civil enforcement, under what circumstances, if any, should the Agencies seek relief beyond merely prohibiting the unlawful conduct?
• What are the comparative advantages and drawbacks of structural remedies such as dissolution and divestiture versus conduct remedies such as membership bars, restitution and firewalls?
• Have the civil remedies employed in past cases been effective?
• Have the Agencies sufficiently monitored and enforced compliance with final judgments once they have been entered?

With respect to criminal enforcement, prosecutions of health care professionals by the DOJ are relatively rare.

Questions for consideration:

• What circumstances, if any, justify criminal enforcement in health care antitrust cases, and what are the impediments to such prosecutions?
• Given the rarity of criminal prosecutions, are civil remedies adequate?
• How, if at all, should the availability of private treble damages affect the relief sought by the Agencies?
• What changes in remedies might make the application of competition law to health care more effective?

Panelists:

• Jack Bierig, Sidley & Austin
• James A. Donahue, III, Pennsylvania Office of the Attorney General
• Kevin Grady, Alston & Bird
• Gail Kursh, Department of Justice
• Kevin J. O'Connor, Godfrey & Kahn
• Melvin H. Orlans, Federal Trade Commission
• Toby Singer, Jones Day
  

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