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Last week, the U.S. Department of Justice (DOJ) withdrew its support for three policy statements on health care antitrust enforcement it had jointly issued with the Federal Trade Commission (FTC).
These withdrawn policy statements had created longstanding safe harbors from antitrust enforcement on which the health care industry has relied for decades. The DOJ has now criticized these policies as “outdated” and “overly permissive.”
The three policies from which the DOJ has withdrawn are:
- A 1993 policy statement that created “antitrust safety zones” (in which the DOJ and FTC would ordinarily not pursue antitrust enforcement) for the following transactions:
- Hospital mergers
- Hospital joint ventures involving high-technology or other expensive medical equipment
- Physicians’ provision of information to purchasers of health care services
- Hospital participation in exchanges of price and cost information
- Joint purchasing arrangements among health care providers
- Physician network joint ventures
- A 1996 policy statement expanding and further clarifying the “antitrust safety zones” and addressing physician network joint ventures.
- A 2011 policy, issued in the wake of the Affordable Care Act, that applies to accountable care organizations (ACOs) participating in the Medicare shared savings program. It provides an antitrust safety zone for ACOs, and antitrust guidance outside of the safety zone.
With the withdrawal, these safety zones — and the certainty they have provided to the health care industry — are eliminated. Moving forward, the DOJ’s Antitrust Division indicated that it expects to take a “case-by-case enforcement approach” when evaluating conduct in health care markets.
The FTC is expected to soon follow the DOJ’s lead in withdrawing support for these policy statements.
Hospitals are encouraged to consult with their legal counsel regarding any existing or planned transactions or arrangements that may fall within the scope of these withdrawn policies.