FTC should reconsider healthcare antitrust standards

These days, doctors can't win for losing. On the one hand, they're supposed to be part of the solution when it comes to healthcare costs, but if they get aggressive in negotiating together, they'll be hit with price-fixing allegations by antitrust regulators.

That's how it looks from here in the case of Alta Bates Medical Group, which just agreed to an FTC consent order that settled charges it had engaged in price-fixing. Now, I never met anyone from Alta Bates, and I'm certainly not qualified to say whether its behavior was out of line. But I wasn't thrilled with the outcome of the case, either.

Yes, antitrust law enforcement is important, even if it means some of doctors' approaches to health plan negotiations are shot down. But on the other hand, after reading the Alta Bates news, I find myself wondering whether the antitrust standards in play need a little bit of updating to allow for current market conditions. With the structure of the healthcare industry poised for major changes, it's going to be necessary, anyway.

For one thing, it'd probably be a good idea to look at new safe harbors for physicians and hospitals who want to find more effective models for cutting costs. That'd involve establishing new standards for anti-competitive behavior, but it'd be worth the trouble.

It'd also be a good idea to look at the broader competitive picture. Specifically, bear in mind that insurers have been merrily consolidating for a number of years now, with one health plan controlling as much as two-thirds of the market share in some major metros, according to research by Health Care for America Now! (Yes, I know they have an agenda, but bear with me.) That's what I call an un-level playing field.

So, FTC, if you're going to challenge physician practices, good for you. There's nothing wrong with keeping an industry honest and competition free. But it won't work too well unless you address the market as it is. - Anne