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| Physician Law Review |
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| Antitrust |
| 2. |
Antitrust
Statutes. |
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There are four major federal antitrust
statutes. These statutes apply to hospitals in a
variety of activities, including merger or
expansion of existing facilities, participation in
joint ventures, exclusive contracting with the
physician groups for the provision of certain
services, and the credentialing and disciplining
of physicians on the medical staff. This
discussion will focus on mergers, joint ventures
and exclusive contracting.
A. Sherman Act, 15 U.S.C. §§ 1 and
2
1. The Sherman Act prohibits 1) contracts,
combinations, and conspiracies in restraint of
trade (Section 1), and 2) monopolization, attempts
to monopolize, and conspiracies to monopolize
(Section 2).
- A violation of Section 1 requires
concerted action between two or more individuals
or entities. For example, if two or more
emergency groups in one geographical area agreed
to make their prices the same (i.e. price
fixing).
- Agreements between a parent company and
its wholly owned subsidiary are not subject to
Section 1 because they are deemed to be acting
unilaterally. Copperweld Corp. v. Independence
Tube Corp., 467 U.S. 752 (1984). Similarly, two
wholly owned subsidiaries of a parent
corporation are not capable of conspiring to
restrain trade. Advanced Health Care Services,
Inc. v. Radford Community Hospital, 910 F.2d 139
(4th Cir. 1990).
2. The Sherman Act is enforced through
criminal or civil actions brought by the
Department of Justice in federal district courts.
Private parties also may bring a suit under these
provisions.
B. Federal Trade Commission Act, 15
U.S.C. & 45
- The Federal Trade Commission Act
prohibits 1) unfair methods of competition, and
2) unfair or deceptive acts or
practices.
- The Federal Trade Commission Act is
enforced by the Federal Trade Commission in
administrative proceedings subject to review in
federal courts of appeal. The Commission has
authority to issue cease and desist
orders.
C. Clayton Act (Sections 3 and 7), 15
U.S.C. && 14 and 18
- The Clayton Act prohibits 1) exclusive
dealing arrangements, tying sales and
requirements contracts involving the sale of
commodities, where the effect may be to
substantially lessen competition (Section 3),
and 2) mergers, joint ventures, consolidations,
or acquisitions of stock or assets where the
effect may be to substantially lesson
competition or tend to create a monopoly
(Section 7).
- The Clayton Act is enforced by the
Department of Justice and the Federal Trade
commission. Private parties also may enforce the
Clayton Act.
D. Robinson-Patman Act (Section 2 of the
Clayton Act), 15 U.S.C.
&13
- The Robinson-Patman Act prohibits
unlawful discrimination in prices between
different purchasers in the sale of a commodity,
where the discrimination may lessen
competition.
- The Robinson-Patman
Act is also enforced by the Department of
Justice and the Federal Trade
Commission.
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