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Show when substantial compensation is withheld from the physician at the time of service and distributed to members only if group cost-containment goals are met. The safety zone applies to both "exclusive" and "non-exclusive" physician networks; however, the nature of the network is important to the analysis of ventures outside the antitrust safety 10 zone.' Examination of Collaborative Agreements Beyond the Margins of the Safety Zones The new guidelines do not assume that all ventures falling outside the safety zones in each of the areas described above are automatically illegal. Such ventures are to be evaluated in the context of the situation for which they are proposed. If the proposed collaborative agreement falls outside the antitrust safety zone, the DOJ and FTC invite the parties to submit the agreement for a DOJ "business review" and an FTC "advisory opinion." With the exception of proposed hospital merger, the DOJ and FTC are committed to responding no later than 90 days after all necessary information is received. This offer of guidance suggests that the enforcement agencies may be willing to help proposed collaborators find ways in which to accomplish their desired goals without running afoul of the antitrust laws. The guidelines suggest the evaluation processes that will be used in examining proposed collaborative agreements and as well those embarked upon without advisory opinions from the federal agencies. Hospital Mergers: Hospital mergers outside the safety zone are to be analyzed according to the five-step process outlined in the DOJ-FTC 1992 Horizontal Merger Guidelines. The primary concern is whether the merger will substantially lessen competition and, if it does whether the benefits to be gained outweigh the costs that will be imposed.11 Experience with past hospital merger cases suggests that market share is not always an accurate indicator of the potential for competition. 10 An "exclusive" venture restricts the ability of its members to affiliate with other physician network joint ventures and to contract individually with health insurance plans. A "nonexclusive" venture does not restrict its members' ability to affiliate or contract with such organizations. 11 While this appears to argue that the 1992 DOJ and FTC Guidelines for merger embrace an economic efficiency standard, other parts of the Guidelines suggest otherwise. For example, the Guidelines describe the adverse results from the exercise of market power as including a transfer of wealth from buyers to sellers (area A of Figure 1) or the misallocation of resources (area B of Figure 1). Two situations which are not expected to lead to a lessening of competition include: (1) a merger which results in a post-merger emergence of a strong competitor or sufficient differentiation of the merger partners (in terms of their specialties and/or patient populations served) such that they can not be considered horizontal competitors; or (2) the merger would eliminate a hospital that likely would fail resulting in the loss of its assets to the market. Hospital Joint Ventures Involving Expensive Equipment: The analysis of collaborative agreements designed to pool patients in order to achieve high rates of utilization on expensive equipment or spread the risk of high-technology ventures are likely to involve the following steps: 1) definition of the relevant product and geographic markets; 2) evaluation of the competitive effects or market power of the venture, including existing and potential competitors, regulatory restraints on price, and special characteristics of the market that make anti-competitive agreements unlikely; 3) evaluation of the impact of pro competitive efficiencies, including efficiencies from spreading the cost of expensive equipment, management, and marketing expenses over a large number of patients; improvement in quality as providers gain experience and skill from performing a large number of procedures; and the provision of new and unique products or services in the relevant market area; and 4) evaluation of the necessity and role of ancillary agreements. Physicians' Provision of Information to Purchasers of Health Care Services: No specific analysis is outlined for collective agreements to provide information. However, some practices are explicitly prohibited. Excluded in the antitrust safety zone is any joint attempt by physicians to coerce a purchaser by threatening to or boycotting its plan or refusing to deal with a plan or purchaser that does not follow the physicians' joint recommendation. The safety zone does not extend to physicians' collective provision of fee-related information to purchasers. These exclusions are still considered per se violations of the antitrust laws. Hospital Exchanges of Price and Cost Information: Exchanges of information will be evaluated to determine whether the exchange may have an anti-competitive effect that outweighs any pro-competitive justification for the exchange. Surveys initiated by third parties probably will not 108 REVOLUTION, EVOLUTON, OR BUSINESS AS USUAL? |