Health Law Daily Wrap Up, HEALTH CARE COMPLIANCE NEWS—DOJ settles antitrust case against South Dakota chiropractic association, (Apr 10, 2013)

By Sheila Lynch-Afryl, JD, MA

The Department of Justice (DOJ) filed an antitrust suit against and reached a proposed settlement with Chiropractic Associates Ltd. of South Dakota (Chiropractic Associates), an association of chiropractors in South Dakota, according to a DOJ competitive impact statement. The settlement resolves allegations that Chiropractic Associates, which includes 80 percent of practicing chiropractors in South Dakota, negotiated contracts on behalf of all its members, including competing providers, resulting in higher prices for chiropractic services in the state.

In a news release, Assistant Attorney General Bill Baer, head of the DOJ’s antitrust division, said that the settlement “promotes competition among health care providers and prevents collective action that harms consumers and violates the antitrust laws.”

The complaint alleged that Chiropractic Associates required chiropractors joining the association to enter into a membership agreement authorizing it to negotiate the fees that its chiropractors charge payers for services. Since 1997, Chiropractic Associates negotiated at least seven contracts with insurers setting prices on behalf of its members. These contracts, the DOJ alleged, caused patients to pay higher fees for chiropractic services and decreased the availability of chiropractic services in South Dakota. These providers, except for those that were part of the same practice groups, were not financially or financially integrated and the contracts were not needed to benefit consumers, according to the DOJ.

The proposed settlement prohibits Chiropractic Associates from establishing prices or terms for chiropractic services and from negotiating with insurers on behalf of competing chiropractors. It also requires the association to terminate its current payer contracts at specified times.

The proposed settlement will be published in the Federal Register and comments must be submitted within 60 days after publication.

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