United States v. Charleston Area Med. Ctr., Inc. — Oct. 2016 (Summary)

United States v. Charleston Area Med. Ctr., Inc.
Civil Action No. 2:16-3664 (S.D. W. Va. Oct. 21, 2016)

The United States District Court for the Southern District of West Virginia granted a United States proposed final judgment against two healthcare providers operating two separate general acute-care hospitals in two different counties.

The United States alleged that the two healthcare providers entered into an agreement to limit the marketing of competing healthcare services in violation of the Sherman Act.  The United States further alleged that on multiple instances, pursuant to their agreement, the healthcare providers either failed to approve certain advertisements placed in the other provider’s county, or removed the advertisement at the request of the other provider if such advertisement was in their county.  On one occasion, the marketing department of one provider mentioned that they do not advertise in the other provider’s county due to a gentleman’s agreement.  According to the United States, the alleged agreement disrupts the competitive process, harming both patients and physicians.  The agreement “[deprives] patients of information they otherwise would have when making important healthcare decisions and…[denies] physicians…the opportunity to advertise their services to potential patients.”

Before the proposed final judgment can be approved, the court must determine whether the judgment is in the public interest.  In order to make such a determination, the court looked to the United States’ complaint and the proposed final judgment to “determine if the remedies in the proposed final judgment effectively address the harms identified in the complaint.”  The court found that the public interest is served by approving the proposed final judgment.  The proposed final judgment eliminated the anti-competitive impact of the agreement between the healthcare providers by prohibiting the agreement and limiting marketing communications between the providers; provided a remedy that is unambiguous and does not propose difficulties in implementation; and provided both internal briefing and outside inspections to ensure compliance with the proposed judgment.  Most importantly, the proposed final judgment fostered competition in the healthcare market and allowed physicians the opportunity to advertise their services to potential patients in a larger geographic region.