Feds, Michigan file antitrust suit against four hospital systems

The United States Department of Justice and the Michigan Attorney General have filed an antitrust lawsuit against four hospital systems in the Great Lakes State, claiming they entered into agreements to curb their marketing to allocated territories.

The lawsuit was filed against the Hillsdale Community Health Center; Community Health Center of Branch County; the ProMedica Health System in Toledo; and Allegiance Health. Hillsdale, Community Health and ProMedica have agreed to settle the suit by ending any non-competitive practices, according to the DOJ. The suit against Allegiance, which operates W.A. Foote Memorial Hospital in Jackson, Mississippi, will be litigated.

Hillsdale allegedly entered into an agreement with the three other systems to self-curb their marketing efforts for certain services. The hospital systems all essentially compete against one another in several counties in southern Michigan.

"These hospitals conspired to deprive consumers and physicians of important health information and education," Assistant Attorney General Bill Baer of the Justice Department's Antitrust Division said in the statement. "Instead of putting patients first, these hospitals secretly agreed not to compete. This action will terminate the agreements limiting marketing and make sure the citizens of south-central Michigan will have access to the facts they need to make informed healthcare choices."

The lawsuit is slightly unusual in that most antitrust actions in recent years against hospitals have targeted mergers as opposed to potential collusion. And typically, the DOJ usually focuses on unwinding mergers after they have occurred. One such illustrative suit actually targets ProMedia and its acquisition of an Ohio hospital.

Allegiance, meanwhile, claimed in a statement that an agreement to limit advertisements in Hinsdale County did not stop the number of patients it treated from that region from growing. 

"Ultimately, Allegiance's marketing strategy has greatly benefitted consumers," the statement read in part. The system said it expected to prevail in court.

To learn more:
- check out the DOJ statement 
- here's Allegiance's statement

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