Antitrust Law Daily Wrap Up, TOP STORY—Oklahoma Chiropractor Association Agrees to Refrain from Jointly Negotiating Fees for Members, (Jan 11, 2013)

By Jeffrey May, J.D.

The Oklahoma State Chiropractic Independent Physicians Association (OSCIPA) and its executive director have agreed to settle Department of Justice Antitrust Division allegations that they violated Sec. 1 of the Sherman Act by jointly negotiating fees on behalf of competing chiropractors. A complaint was filed in the federal district court in Tulsa on January 10. At the same time, the government filed a proposed consent decree, that if approved by the court, would resolve the civil suit (U.S. v. Oklahoma State Chiropractic Independent Physicians Assn., Case 4:13-cv-00021-TCK-TLW).

According to the Justice Department, the association of approximately 350 chiropractors and the group's executive director negotiated at least seven contracts with payers that set prices for chiropractic services on behalf of OSCIPA’s members between 2004 and 2011. The executive director signed several of those contracts on OSCIPA’s behalf.

Upon joining OSCIPA, a chiropractor allegedly gave contracting authority to OSCIPA and immediately charged the price set by the association for its several contracts, even if the chiropractor already had an individually negotiated contract with that payer. The government contends that the association's practice of negotiating contracts on behalf of OSCIPA’s members increased prices for chiropractic services in Oklahoma.

Under the terms of the proposed consent order, OSCIPA and its director have agreed to refrain from establishing prices or terms for chiropractic services and from negotiating with insurers on behalf of competing chiropractors. The proposed settlement also will prevent them from attempting to facilitate joint negotiations and from communicating with chiropractors about any aspect of pricing or contracting.

“By jointly negotiating fees on behalf of competing chiropractors, the association and its executive director increased the prices that consumers paid for chiropractic services in Oklahoma,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice Antitrust Division. “Today’s settlement promotes competition among Oklahoma chiropractors and prevents the association and its executive director from engaging in illegal conduct that caused consumers to pay more for their health care.”

In recent years, the FTC has taken the lead in challenging alleged agreements among health care providers to increase reimbursement rates through joint negotiations on behalf of competitors. In 2010, the FTC entered into consent orders over alleged joint fee negotiations involving two independent practice associations—the Boulder Valley Individual Practice Association and Roaring Fork Valley Physicians I.P.A., Inc.

Robert B. Sartin (Barrow & Grimm PC) for defendants.

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