Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Hospital association allegedly monopolized temporary nurse staffing industry, (Jan 20, 2016)

By Linda O’Brien, J.D., LL.M.

A hospital association and its member health systems have conspired to control temporary and traveling nurse staffing in order to exclude competitor medical personnel staffing companies, according to a complaint filed in the federal district court in Greenville, South Carolina (Advance Nursing Corporation v. South Carolina Hospital Association, January 18, 2016).

Advance Nursing Corporation places medical personnel throughout upper South Carolina and offers daily per diem staffing and long term contracts to hospitals, health care facilities, and government institutions. South Carolina Hospital Association (SCHA) is a private, non –profit organization comprised of 100 member hospitals and health systems and 900 individuals associated with the institutional members. SCHA negotiates and oversees all temporary and traveling nurse contracts with staffing companies in South Carolina.

The complaint states that the SCHA, along with its member hospitals and health systems—Greenville Health Corporation, Spartanburg Regional Health Services District, Inc., Mary Black Health System, Palmetto Health, Lexington Medical Center, Toumey Health Care System, Carolinas Hospital System, and Bon Secours Health System, Inc.—conspired to regulate and control temporary labor and traveling nurse staffing in order to exclude staffing competitors in the South Carolina market. Additionally, the SCHA has exercised exclusive control over the South Carolina health care staffing industry.

According to the complaint, the defendants have engaged in unfair or deceptive practices by: (1) imposing unreasonable administrative fees on staffing companies; (2) preventing direct contact between Advance and hospitals and/or health centers; (3) exchanging wage rates and benefits information between hospitals; (4) vetting staffing companies for SCHA membership using arbitrary and capricious review standards; and (5) imposing unreasonable contracts and contract terms upon staffing companies.

The acts and representations of the defendants have the potential to deceive and mislead consumers, are offensive to public policy, and are likely to cause substantial injury to consumers, Advance claims.

The complaint also alleges that the conduct of the defendants has caused Advance substantial economic harm. In particular, Advance claims it has been prevented from staffing temporary and traveling nurses for hospitals and health care facilities in South Carolina or has done so at a reduced rate.

The plaintiff asserts claims for tortious interference with contractual and prospective contractual relations, unfair or deceptive practices, civil conspiracy, monopolization, and attempted monopolization in violation of Sections 1 and 2 of the Sherman Act and South Carolina Unfair Trade Practices Act. The action seeks declaratory and injunctive relief, damages, and any other just and proper relief.

The case is No. 6:16-cv-00160-MGL.

Attorneys: Wendell L. Hawkins and Aimee V. Leary (Wendell L. Hawkins, PA) for Advance Nursing Corporation.

Companies: Advance Nursing Corporation; South Carolina Hospital Association; Greenville Health Corporation; Spartanburg Regional Health Services District, Inc.; Mary Black Health System; Palmetto Health; Lexington Medical Center; Toumey Health Care System; Carolinas Hospital System; Bon Secours Health System, Inc.

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