Assembled Products: The Key to More Effective Competition And Antitrust Oversight in Health Care.

This Article argues that recent calls for antitrust enforcement to protect health insurers from hospital and physician consolidation are incomplete. The principal obstacle to effective competition in health care is not that one or the other party has too much bargaining power, but that they have been buying and selling the wrong things. Vigorous antitrust enforcement will benefit health care consumers only if it accounts for the competitive distortions caused by the sector's long history of government regulation. Because of regulation, what pass for products in health care are typically small process steps and isolated components that can be assigned a billing code, even if they do little to help patients. Instead of further entrenching weakly competitive parties engaged in artificial commerce, antitrust enforcers and regulators should work together to promote the sale of fully assembled products and services that can be warranted to consumers for performance and safety. As better products emerge through innovation and market entry, competition may finally succeed at lowering medical costs, increasing access to treatment, and improving quality of care.

Seeking lower prices where providers are consolidated: an examination of market and policy strategies.

The ongoing consolidation between and among hospitals and physicians tends to raise prices for health care services, which poses increasing challenges for private purchasers and payers. This article examines strategies that these purchasers and payers can pursue to combat provider leverage to increase prices. It also examines opportunities for governments to either support or constrain these strategies. In response to higher prices, payers are developing new approaches to benefit and network design, some of which may be effective in moderating prices and, in some cases, volume. These approaches interact with public policy because regulation can either facilitate or constrain them. Federal and state governments also have opportunities to limit consolidation's effect on prices by developing antitrust policies that better address current market environments and by fostering the development of physician organizations that can increase competition and contract with payers under shared-savings approaches. The success of these private- and public-sector initiatives likely will determine whether governments shift from supporting competition to directly regulating payment rates.

Kickbacks, stark violations, client billing, and joint ventures: facts and controversies.

Many current business trends in the field of dermatopathology deserve ethical scrutiny. An important point to consider in these analyses is that which is legal is not necessarily ethical. We examine the topics of client billing, contractual joint ventures, and health information technology donations, including both the legal implications as pertaining to the Stark Law and Anti-Kickback Statute, and the ethical ramifications of these practices.

Hospital-physician relationships: implications from the professional service firms literature.

PURPOSE: The hospital-physician relationship (HPR) has been the focus of many scholars given the potential impact of this relationship on hospitals' ability to achieve socially and organizationally desirable health care outcomes. Hospitals are dominated by professionals and share many commonalities with professional service firms (PSFs). In this chapter, we explore an alternative HPR based on the governance models prevalent in PSFs. DESIGN/METHODOLOGY APPROACH: We summarize the issues presented by current HPRs and discuss the governance models dominant in PSFs. FINDINGS: We identify the non-equity partnership model as a governance archetype for hospitals; this model accounts for both the professional dominance in health care decisions and the increasing demand for higher accountability and efficiency. RESEARCH LIMITATIONS: There should be careful consideration of existing regulations such as the Stark law and the antikickback statue before the proposed governance model and the compensation structure for physician partners is adopted. RESEARCH IMPLICATIONS: While our governance archetype is based on a review of the literature on HPRs and PSFs, further research is needed to test our model. PRACTICAL IMPLICATIONS: Given the dominance of not-for-profit (NFP) ownership in the hospital industry, we believe the non-equity partnership model can help align physician incentives with those of the hospital, and strengthen HPRs to meet the demands of the changing health care environment. ORIGINALITY/VALUE: This is the first chapter to explore an alternative hospital-physician integration strategy by examining the governance models in PSFs, which similar to hospitals have a high reliance on a predominantly professional staff.

Commercially reasonable--whose responsibility is it?

According to federal regulations, any business arrangement between a hospital and a physician or physicians must comply with a set standard establishing that the arrangement is commercially reasonable. The commercially reasonable standard can be briefly defined as the requirement that the arrangement make business sense without being contingent on physician referrals. Before engaging outside expertise to assist in making the determination that an arrangement is commercially reasonable, hospital executives can address many key questions with respect to this determination themselves using a checklist of key operational, clinical, and financial considerations.

A critical appraisal of physician-hospital integration models.

The economic environment and the current health care debate have prompted a critical reevaluation of previous and current physician-hospital integration models. Even though the independent, self-employed, private practice, medical staff remains the most common model, surgical specialists such as vascular surgeons are increasingly being employed and integrated into health care delivery systems. The degree of integration varies from minimal to full integration or full employment. This review defines the forces driving these changes and analyzes the strengths and weaknesses of each employment model from the physicians' point of view. Strategies for the successful implementation of a 21st century integrative employment model are discussed.

Legally speaking: Federal Trade Commission issues positive advisory opinions on antitrust implications of clinical integration.

From time to time, groups of physicians in an area may determine that they would benefit from "integrating" their practices into an IPA, PHO, or other joint venture. The anticipated benefits may include economies of scale, the ability to coordinate care between primary care physicians and specialists, providing disease management services for patients with certain conditions, or a myriad of other reasons. A key characteristic of these proposed integrated models is the ability for the group as a whole to negotiate with insurance companies and self-funded health care plans. When a group reaches the point of negotiating collectively for the fees that a pay- or is going to pay for various services throughout the plan, possible antitrust implications arise.