What Medical Cartels Do - Part I
29 Surgeons Average $14,000 Increase In Revenues During Only a Few Months Of Illegal Joint Negotiations
Medical cartels, though illegal, already exist. The FTC and Justice Department have ruled on more than 50 cases of health care price-fixing over the past 25 years, the vast majority of which involved doctors. This blast fax describes a consent decree that the Antitrust Division of the Justice Department recently entered into with a medical cartel.
H.R. 1304, the Quality Health Care Coalition Act of 1999, would permit physicians and pharmacists to engage in price-fixing, boycotts and market allocation agreements that will increase their fees and force consumers to pay more for health care.
Joel Klein, Assistant Attorney General, Antitrust Division, U.S. Department of Justice, in testifying before the House Judiciary Committee against H.R. 1304, described an arrangement that is illegal under current law that would be legalized if that bill were enacted.
"In our Federation of Certified Surgeons and Specialists case," Klein told the committee, "twenty-nine otherwise competing surgeons who made up the vast majority of general and vascular surgeons with operating privileges at five hospitals in Tampa formed a corporation solely for the purpose of negotiating jointly with managed care plans to obtain higher fees. Their strategy was a success. Each of the twenty-nine surgeons gained, on average, over $14,000 in annual revenues in just the few months of joint negotiations before they learned that the Division was investigating the conduct. The participants in that scheme did not take any collective action that improved the quality of care."