Tuesday, May 27, 2003

Antitrust News: CAC to FTC: Hands off New Mexico Doctors

Alexandria, VA—Today the Center for the Advancement of Capitalism (CAC) filed public comments on the Federal Trade Commission's (FTC) consent order in the case of Carlsbad Physician Association, Inc. (CPA), a New Mexico corporation formed to allow its members to negotiate on par with health insurance groups. CAC argued that the FTC's antitrust enforcement efforts violate the rights of doctors and will harm the quality of medical care in America.

The FTC’s complaint charged CPA and eight physicians who constitute the company’s members with illegal price fixing for their attempt to collectively bargain with health insurance companies. Under the proposed consent order, the six doctors are effectively prevented from engaging in any collective bargaining activity for a period of 20 years and CPA will be forcibly dissolved.

"CAC has been closely monitoring the FTC's antitrust enforcement efforts against physicians for over a year. Like earlier prosecutions, every aspect of the FTC's case against these doctors is deficient and crumbles upon proper examination,” says Nicholas Provenzo, CAC chairman." "The FTC's antitrust enforcers claim that recognizing a doctor's right to negotiate his fees in concert with other doctors will hurt patients by increasing costs. The FTC should instead observe the effect of its own actions."

"The FTC has made it clear that the only price strategy it would allow doctors to pursue is one that forces them to see more patents for less money," says Provenzo. "This violates the rights of doctors to control the manner in which they work. In addition, reducing the monetary incentive doctors receive for providing care to their patents can hardly be said to be in the patient's best interest."

"Patents already feel like cogs in a vast, uncaring machine," says Provenzo. "The FTC's crusade against doctors will only increase that feeling. It will drive doctors out of medicine and leave patents with a declining standard of care."

“This case represents the government at its worst—prosecuting innocent citizens whose only ‘crime’ is attempting to assert their right to freely negotiate fees paid in exchange for their skills, while claiming that this somehow protects the marketplace,” says CAC Senior Fellow Sean Oliva, who wrote the Center’s comments. "The FTC's mandate is to protect the market—not destroy it, yet the FTC's consent order is confirmed, the marketplace for medicine will be seriously damaged."

A copy of the CAC comment letter in PDF format can be downloaded at: http://www.capitalismcenter.org/Campaigns/Antitrust/CAC_Comment_on_NMCPA.pdf

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