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Antitrust defined

Medical Staff Leader Connection, November 4, 2004

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Dear Medical Staff Leader:

This letter is in response to the many requests I've received for a definition of "antitrust." These request are likely the result of the an August 28, 2004 district court jury decision to order Dallas-based Presbyterian Hospital to pay $161 million in damages to a member of its medical staff whose privileges were temporarily restricted. The jury also ordered three members of the hospital's medical staff, who participated in the peer review process that resulted in the revocation of privileges, to pay a total of $205 million.

I have been able to find no better definition than that included in "Slee's Health Care Terms," written by old acquaintances of mine, Vergil N. Slee, MD and Debora A. Slee, JD. The healthcare dictionary defines provides the following definition:

Antitrust : That branch of law which seeks to prevent monopolies and unfair competition. A "trust" was originally a combination of several corporations (each maintaining its separate identity) to eliminate competition, control prices, and the like. The term "antitrust" now broadly covers any activity (or conspiracy) to eliminate competition and control the marketplace. It includes actions which unreasonably restrain trade. Such activities are illegal, and severe penalties are imposed by antitrust laws. For example, the trust may be broken up (see divestiture) and anyone who suffers injury to his business or property as a result of the combination or conspiracy may collect treble damages. Federal antitrust laws (principally the Sherman Act of 1890, the Clayton Act of 1914 and the Federal Trade Commission Act of 1914) apply to companies doing business in interstate commerce. Many states also have antitrust laws.

According to the publication's definition, a hospital's decision to limit medical staff members or to combine services with other facilities may result in an antitrust allegation. Remember that thoughtful legal guidance is important whenever a hospital's actions may "affect competition or regulate prices."

The enactment of the Health Care Quality Improvement Act of 1986 (HCQIA) has decreased the risk of antitrust cases. The HCQIA provides certain protections from damages when the hospital and its medical staff allow physicians with an appropriate fair hearing (judicial review in California).

I hope this sheds some light on the subject.

That's all for this week.

All the best,

Hugh Greeley
http://www.greeley.com/seminars/

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