IPA settles price-fixing charges with FTC
IPA settles price-fixing charges with FTC
North Lake Tahoe Medical Group, Inc., a Truckee, CA-based IPA, has agreed to settle federal charges that it violated federal antitrust laws by restraining competition among physicians in the Lake Tahoe area. The charges, leveled by the Federal Trade Commission (FTC), allege that the IPA engaged in collective negotiations over prices with payers and refused to deal with at least one plan, Blue Shield of California, when it didn’t comply with the IPA’s demands.
Specifically, the FTC’s complaint alleges that the IPA’s 91 physicians:
conspired to fix the prices and other terms under which its members dealt with third-party payers; conspired to prevent or delay the entry into the North Lake and South Lake Tahoe areas of managed care; refused to participate, individually or collectively, in HMO plans offered by Blue Shield, Hometown Health Plan, Foundation Health Plan, St. Mary’s Health Plan, and other third-party payers attempting to do business in the Lake Tahoe basin; coerced payers into accepting IPA fee schedules and minimum reimbursement rates.While the IPA has entered into an administrative consent agreement to correct the problems identified by the FTC, it hasn’t formally admitted to breaking the law. The proposed agreement, is now subject to a public comment period. "Once that comment period is over, we’ll evaluate the comments and see whether or not they would have any significant bearing on the consent agreement as it stands," says Brenda Mack, a public affairs officer with the FTC.
Once the agreement becomes final, it will be published in the Federal Register. After that, every time the FTC finds that the IPA has violated a term of the agreement, it can level a civil penalty of $11,000, Mack says.
Meanwhile, nothing’s stopping the Department of Justice from getting into the act and pursuing its own antitrust charges against the IPA, Mack says. Representatives of the IPA could not be reached for comment.
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