Antitrust Law Encourages Accountable Care Organizations (“ACOs”) Formation

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Once again, the staff of the Federal Trade Commission (“FTC”) has rebutted claims by physician groups that state legislation is needed to allow independent physicians to collaborate.

In support of legislation introduced in Connecticut, eight medical organizations representing more than 9,000 Connecticut physicians claimed that “federal antitrust laws prohibit Connecticut physicians from collective discussions about certain critical aspects of care coordination,” including the kinds of negotiations necessary to form ACOs. The FTC submitted a letter to the Connecticut legislature urging the rejection of the legislation sought by the physicians and disputing the physicians’ assertion that the antitrust laws are a barrier to the formation of efficient collaborations that benefit consumers. “This premise,” according to the FTC staff, “is simply and categorically wrong.”

Well before the passage of the Patient Protection and Affordable Care Act (“ACA”) and its introduction of Medicare’s Shared Savings Programs, the federal antitrust agencies—the FTC and the Department of Justice—provided general guidance on collaborations among competitors, issued joint statements specifically geared toward the application of the antitrust laws to the healthcare industry, including physician network joint ventures and other provider collaborations, and made public opinion letters regarding the antitrust treatment of proposed healthcare collaborations. After the passage of the ACA, the federal antitrust agencies and Centers for Medicare and Medicaid Services (“CMS”) even worked together to develop policies that encourage participation in ACOs and ensure coordination among and between the agencies.

The antitrust agencies also released a joint statement explaining their enforcement policy approach to ACOs is “to ensure that health care providers have the antitrust clarity and guidance needed to form procompetitive ACOs that participate in both Medicare and commercial markets.” In addition, the antitrust agencies established a process for ACOs to seek expedited review if concerned about antitrust risk. In April, for example, the antitrust agencies released a summary of their activities in this area noting that they received two requests for voluntary expedited review and fielded more than thirty questions.

In the words of the FTC, “the antitrust laws do not stand in the way of health care providers in Connecticut” or elsewhere “who form ACOs or other collaborative arrangements that are likely to reduce costs and benefit health care consumers through improved efficiency and improved coordination of care.”