March 11, 2008 — The Connecticut Chiropractic Association (CCA), the Connecticut Chiropractic Council (CCC), and an attorney who allegedly orchestrated an illegal anticompetitive statewide boycott of a Connecticut health insurer have settled an antitrust suit brought against them by the state’s attorney general and the Federal Trade Commission (FTC).
State Attorney General Richard Blumenthal announced the settlement March 5. The lawsuit concerned allegations that the two organizations and attorney Robert Hirtle, CCA’s counsel, illegally agreed to boycott Anthem Health Plans Inc.’s intention to form a new network for chiropractic services that would be administered by American Specialty Health Networks Inc. (ASH).
Blumenthal claimed Hirtle facilitated the conspiracy by urging chiropractors to opt out of the proposed network. Chiropractors feared that the ASH contract would lower reimbursement rates for chiropractic services.
Blumenthal said the alleged illegal boycott improperly influenced the rates paid to chiropractors; raised chiropractic costs for Anthem; and deprived Anthem, ASH, and consumers of the benefits of competition among chiropractors.
Under the settlements, the CCA, CCC, and Hirtle have agreed to pay civil penalties to the state, as well as adopt several measures to prevent anticompetitive practices. In return, the office of the attorney general (OAG) releases the parties from civil claims, actions, suits, or proceedings.
“I am sympathetic to the plight of professional healthcare providers seeking fair compensation from powerful insurance companies, but the law forbids anticompetitive agreements and collusive boycotts,” Blumenthal said in a press release.
In July 2006, chiropractors were notified that, beginning on Nov. 1, 2006, ASH would administer chiropractic benefits for certain Anthem health plans, which serve a large share of insured chiropractic patients in the state.
ASH administers chiropractic benefits for managed-care organizations, establishing the fee schedules for chiropractic services and determining levels of utilization generally deemed medically appropriate, including the number of visits and the types of treatment. Under the ASH contract with Anthem, ASH proposed paying lower fees than Anthem had paid in previous years.
According to the lawsuit, CCA invited Connecticut chiropractors to an Aug. 10, 2006, meeting to discuss the proposed Anthem/ASH contract. Members of CCA, the CCC, and unaffiliated chiropractors, along with Hirtle, attended.
At the meeting, the chiropractors, who are all direct competitors, discussed their concerns about their reimbursement under the proposed ASH contract.
Chiropractors attending the Aug. 10 meeting allegedly openly solicited one another to agree to join the boycott.
According to Blumenthal’s office, as a result of the illegal boycott, later that fall, the ASH/Anthem plan never materialized.
The CCA, CCC, and Hirtle have agreed to pay civil penalties to the state totaling $87,000 (CCA, $50,000; CCC, $20,000; and Hirtle, $17,000). Both chiropractic trade groups have also agreed not to conspire in any form whatsoever to refuse to deal or threaten to refuse to deal with any health insurer. The groups will also establish and maintain antitrust training and compliance programs that will be required of all officers, members, and employees.
Luigi DiRubba, DC, president of the CCC, told Chiropractic Economics, “All doctors in the state hold their patients’ health as utmost priority. It is our position that we fought to preserve the rights of current and future chiropractic patients against the extremely large and powerful forces of the insurance industry. …
“The primary issue [in this case] was the method of utilization management ASH was going to institute would have suffocated the ability of the doctor of chiropractic to properly care for their patient and destroy the patient–doctor relationship.”
Matthew Pagano, DC, CCA spokesperson, and immediate past president, said, “The Connecticut Chiropractic Association is pleased to have put this investigation behind us. As a nonprofit group, we chose to settle to avoid the burden and expense of a legal case. We’re very pleased that the document makes it clear that there’s no admission of wrongdoing.
“There are some education and compliance provisions in the settlement — we believe that they will augment our already existing compliance and training programs in this area. This will help us better serve our members and strengthen our organization.
The CCA intends fully to comply with the provisions of the settlement. It also intends to continue to hold meetings of its membership, and to continue to provide valuable information about the profession to its members at those meetings. We are committed to working wit
h the legislature and other state and federal agencies to protect Connecticut chiropractors.”
Sources: Office of the Attorney General, www.ct.gov/ag; Connecticut Chiropractic Council; Connecticut Chiropractic Association