Florida Health System settles suit against independent practices

Statue holding justice scales

A settlement in a Florida court case may signal good news for independent practices being squeezed by narrow networks’ referral policies, according to an article in Medscape.

A group of independent physicians claim Health First freezed out practitioners who refused to refer patients to the system’s specialists, hospitals or other services. According to the compliant, Health First dropped noncompliant practices from its provider panels and hospital staffs, while pressuring its “compliant” physicians to boycott those practices. In addition, Health First was accused of attempting to take over the local Medicare Advantage market, a dispute similar to the higher-profile case pursued by the U.S. Department of Justice against the proposed Aetna-Humana merger, according to the article.

Limited choice for referrals has become an increasing issue with the rise of narrow networks, whose restrictions can further pressure independent providersFiercePracticeManagement previously reported. The plaintiffs in the Florida case pointed to Health First’s acquisition of the largest group of independent physicians in its geographical area as an attempt to hamstring its competition and raise the cost of care to the point where those outside the network could not compete, according to the article. The suit had sought to force Health First to reverse the acquisition, as well as to “divest its health plans and pay close to $350 million in monetary damages.”

Health First attempted to get the case thrown out by arguing that its moves amounted to “competitive market forces, not antitrust violations.” Under this argument, any “downward pressure” the plaintiffs felt on their reimbursement rates stemmed from Health First’s innovative delivery model compared to the plaintiffs’ “archaic” volume-based payment model. The two sides struck a settlement the second day after the case went to trial, per Medscape, which was unable to glean any further information about the settlement terms.

- see the article