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Be aware of possible antitrust violations when discussing third-party issues

October 24, 2013

Health care is becoming increasingly controversial, and nowhere more than among health care practitioners themselves. With changing marketing conditions and the federal Affordable Care Act spurring change, health plan provider agreements, fee schedules, and other aspects of third-party reimbursement are topics of interest for practitioners – including optometrists.

Amid the controversy, health care practitioners should remember that discussion regarding reimbursements or other third-party contract terms – at formal or informal meetings, in electronic or print media, or during private conversations – can lead to violations of federal or state antitrust laws with potentially severe penalties, according to AOA General Counsel Michael Stokes, J.D.

“Most health care practitioners realize that antitrust law applies to health care just as it does to any other field of business or commerce,” Stokes said. “Virtually all optometrists understand the obvious implication: like other businesses, they cannot collude to take part in any of list of activities that are held under the law to be inherently anticompetitive with an inherently detrimental effect on consumers: price-fixing, bid-rigging, market-sharing, and group-boycotting.”

Many optometrists – particularly those new to the profession – may not always be mindful of a common legal adage: antitrust law holds health practices, in most instances, to be businesses, not labor. Laborers can organize into unions that, when federally recognized, can negotiate contracts collectively on behalf of their members. Health care practitioners, under most circumstances, cannot.

For that reason, organizations representing health care practitioners – including the AOA and its affiliated state optometric associations – cannot:

  • Engage in concerted negotiations with third-party payers on reimbursement policies.
  • Enter into any agreements with a third-party payer on the amount of reimbursement or the acceptance or rejection of any rates.
  • Facilitate concerted action to increase fees or reimbursement rates. (For a detailed list of actions prohibited under federal law, see below.)
  • Facilitate communicaions or other actions by their members that could ultimately have an anticompetitive effect on the health care marketplace.

“Antitrust concerns arise when a group of members or others acting collectively approach a third party or a customer on behalf of a group, or even when a number of individual members take action separately based upon something that was discussed at a meeting,” said Stokes. “It doesn’t take much to show an agreement among competitors – a ‘wink and a nod’ is all it takes. That is why AOA, like most trade and professional associations, has a policy that prohibits any discussion of individual members’ costs and reimbursement rates at AOA meetings.”

The AOA and state optometric associations can approach insurance plans to seek information regarding general plan policy. They also provide educational information to third-party payers on optometric scope of practice, the procedures performed by optometrists, and the costs incurred by optometrists in the course of providing care.

Should an insurance plan bar optometrists from its medical eye care provider panel for procedures within the optometrists’ scope of practice, or reimburse optometrists less than ophthalmologists for comparable services, the AOA or state optometric associations can enquire with plan officials about the discrepancy and provide relevant information regarding practice costs or applicable law. They can also lobby state legislatures or other governmental bodies on behalf of the AOA’s members for governmental action related to insurance plan reimbursement or policy.

“Individual optometrists and practices may take any action they feel is appropriate in their independent dealings with third-party payers,” Stokes emphasized. “However, a group of optometrists who are not in practice together cannot reach an agreement or engage in a collective effort to either pressure or withdraw their participation from a third-party payer because such an agreement or effort would amount to a group boycott in violation of the antitrust laws.”

Penalties for antitrust law violations can be severe. Both the Antitrust Division of the United States Department of Justice and the Federal Trade Commission can bring civil lawsuits enforcing the laws. The United States Department of Justice alone may bring criminal antitrust suits under federal antitrust laws. In addition, private civil suits may be brought, in both state and federal court, against violators of state and federal antitrust law. Federal antitrust laws, as well as most state laws, provide for double and triple damages against antitrust violators.

The FTC Health Care Division’s latest Overview of FTC Antitrust Actions in Health Care Services (http://tinyurl.com/o2uhay4), issued in March 2013, lists at least 50 cases specifically involving price-fixing or boycotts of health insurance plans health care practices, independent practice associations, or associations representing health care professionals, that have been resolved by the division since its inception.

Association actions prohibited under antitrust law

  • Engage in concerted negotiations with third-party payers on the reimbursement policies.
  • Enter into any agreements with a third-party payer on the amount of reimbursement or the acceptance or rejection of any rates.
  • Facilitating concerted action to increase fees or reimbursement rates. Such concerted action would include:

1. Recommending that its members withdraw from contracting with a third-party payer (group boycott)

2. Adopting a resolution that its members should not participate in a third-party payer’s plan or prohibiting members’ participation in the plan

3. Recommending that its members not disclose certain patient medical information requested by a third-party payer

4. Asking members to pledge to not submit patient information requested by a third-party payer

5. Recommending that its members protest or challenge every reimbursement made by a third-party payer

6. Threatening mass resignation if the third-party payer’s policies are not acceptable to the association or its members.

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