Merge right: market forces and antitrust.

As providers, insurers, and physicians partner for market share, nurse leaders' responsibilities change. To ensure nursing's bright future, leaders must understand the corporate, consumer, and legal trends affecting the marketplace.

Physician organizations: two years under the FTC/DOJ guidelines.

The joint antitrust enforcement statement for physician networks was designed in part to dispel uncertainty in the physician community about antitrust agency law enforcement intentions. In the two years since its issuance, the antitrust agencies have generally, but not always, been consistent in applying the methodology and standards set forth in their enforcement statement. Even though agency pronouncements like the enforcement statement are not binding on private parties or the federal courts, both the statement and subsequent advisory opinions and business review letters have been exceptionally helpful, if not always encouraging, to health care providers in their antitrust planning efforts.

Legal issues in accepting capitation.

The effort to reduce the cost of medical, hospital, and ancillary services increasingly focuses on shifting the financial risk for the cost of these services to those who provide them. Shifting arrangements include capitation for physicians classified as "primary care" physicians; capitation arrangements that include primary and specialty services; risk shifting to medical groups, IPAs, and other physician organizations; as well as the packaging of physician and hospital services on a "full risk," "per case," or other basis. Accepting financial risk for the cost of medical and other health care services, as well as the responsibility for managing the provision of services, may very well be the only remaining opportunity for providers to maximize reimbursement and maintain administrative and clinical self-direction. However, physicians must work with managed care organizations (MCOs) through negotiation of contracts and throughout the relationship to make sure: Unnecessary financial and legal risks to the MCO and physicians are eliminated. Risks that cannot be eliminated are apportioned between the MCO and physicians. All risks are managed in a coordinated fashion between the MCO and physicians.

Federal antitrust merger enforcement standards: a good fit for the hospital industry?

We examine the implications of the 1992 Horizontal Merger Guidelines for the hospital industry and subsequent policy statements that were developed for health care providers. Application of antitrust policy to hospitals has raised several concerns, mainly because many communities have few hospitals and economic forces in the industry are accelerating interest in intramarket mergers and provider network development. We address several issues, including the standing of hospitals relative to the market concentration thresholds of the merger guidelines, market concentration compared among challenged and unchallenged mergers of the 1980s, findings of previous research about the relationship between market concentration and competition in hospital markets, and differences in characteristics other than market concentration that are relevant to the merger guidelines among challenged and unchallenged mergers. We found that (1) the specific standards articulated in the merger guidelines do not provide good predictability of when a hospital merger challenge would occur, and (2) comparisons of challenged and unchallenged mergers in similarly structured markets suggest that enforcement actions may deviate in practice from the enforcement principles of the merger guidelines. We consider several options for refining antitrust enforcement policy. Refinement of enforcement policies is important given the industry restructuring that is likely through health care reform.

Antitrust regulators push partnership as alternative to hospital merger.

In the past, antitrust regulators seemed to favor mergers that would result in cost efficiencies and were not opposed by third-party players. A recent decision about a proposed merger of two Florida hospitals, however, changed that stance, writes Linda R. Blumkin, partner in the New york law firm of Fried, Frank, Harris, Shriver & Jacobson.

Federal Trade Commission drops challenge to California hospital acquisition.

The significance of patient outmigration patterns, third-party payor reaction, and post-merger cost savings have been regularly argued by defense counsel and hospitals as important consideration in the antitrust evaluation of hospital mergers. The reliance placed by the Commission on these factors in its Ukiah decision is a welcome confirmation that the antitrust agencies are increasingly sensitive to these aspects of hospital mergers, reflecting a more sophisticated understanding of the health care market than was suggested by the staff's more mechanical evaluative approach. Hospitals and their counsel should therefore prepare for and document these factors if they anticipate antitrust agency scrutiny of a proposed acquisition or merger.

Economic credentialing: your money or your life!

The economic overhaul of health care in America is restructuring the business of medicine, and with it the relationship between physician and patient. Previously accustomed to thinking primarily about the best interests of each patient, the physician now finds this traditional loyalty in conflict with competing concerns, including those of government, business, and insurers who watch with alarm the relentless rise in their health care expenditures. And there are competing interests of hospitals, health maintenance organizations, and other provider-institutions who find their survival threatened by high-powered competition and increasingly stringent resource limits, and interests of other physicians and their patients whose health needs compete for limited health care dollars.