Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Osteopathic physicians’ medical association sued over membership requirement to maintain board certification, (Aug 3, 2016)

By Linda O’Brien, J.D., LL.M.

A medical association for physicians practicing osteopathic medicine has engaged in an unlawful tying arrangement by requiring physicians with prior board certification to purchase annual memberships in order to maintain those certifications, according to a complaint filed in the federal district court in Camden, New Jersey (Talone v. The American Osteopathic Association, August 1, 2016).

Albert Talone, Craig Was, Richard Renza, and Roy Stoller are osteopathic physicians certified by the American Osteopathic Board of Family Physicians (AOBFP).

The American Osteopathic Association (AOA) is a professional association for physicians with a Doctor of Osteopathic Medicine degree (DO) and for medical students enrolled in one of the AOA’s colleges of osteopathic medicine. The AOA offers certain member benefits, including continuing medical education courses, networking opportunities, information on advances in medicine, billing resources, and volume discount arrangements. However, the membership in the Association is not essential to the actual practice of osteopathic medicine.

The complaint states that the AOA has established and controls an expansive system of accreditation for osteopathic medical schools and for residency programs. The Association is also the only accrediting agency for osteopathic graduate medical education. The AOA has established 18 certifying boards that administer the process of board certification for DOs. Board certification is very important because patients rely upon board certification to select the most competent physicians, most hospitals require that physicians be board certified in order to obtain privileges, and insurance companies frequently require physicians to be board certified in order to participate in their networks. Once a physician is board certified, it is extremely important to maintain that certification.

The AOA charges examination, processing, and administrative fees to physicians who apply for board certification. In addition, the Association charges an annual board certification maintenance fee. Beginning in July 2012, the AOA has required all DOs to purchase an annual membership in the Association and pay dues in order to avoid the deactivation of their AOA board certification, the complaint alleges.

According to the complaint, the AOA’s annual regular membership dues are presently $683 per year and the Association is receiving more than $20 million per year by unlawfully forcing its membership on physicians under the threat of invalidating prior board certification. The revenues that the AOA receives from the various fees paid by physicians for their board certifications are far in excess of the actual operating expenses associated with the board certification process.

There are no reasonable substitutes for AOA board certification available to physicians who have completed AOA accredited residency programs, the plaintiffs allege. The plaintiffs have been forced to purchase annual membership in the AOA and incur membership fees in order to avoid having their AOA board certification invalidated or canceled. The AOA’s practice of forcing physicians to annual memberships constitutes an illegal tying arrangement, the complaint claims. There are no procompetitive justifications for the AOA’s requirement that physicians buy an annual membership in the Association in order to maintain their board certification.

The plaintiffs assert claims for unreasonable restraint of trade in violation of Section 1 of the Sherman Act and the New Jersey Antitrust Act. The action seeks declaratory relief, treble damages, pre- and post-judgment interest, costs of suit, attorney fees, and any other just and proper relief.

The case is No. 1:16-cv-04644-NLH-JS.

Attorneys: Seth A. Goldberg and James Greenberg (Duane Morris LLP) for Albert Talone.

Companies: The American Osteopathic Association

News: Antitrust NewJerseyNews