Sebelius Acknowledges Tension Between Care Coordination, Antitrust Laws

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Sebelius Acknowledges Tension Between Care Coordination, Antitrust Laws
April 10, 2013 | By Julie Bird

The Affordable Care Act's emphasis on coordinating and integrating healthcare can conflict with government antitrust efforts, U.S. Department of Health & Human Services Secretary Kathleen Sebelius said Monday. "There is a tight balance between a coordinated care strategy and a monopoly," Sebelius said in comments at the Harvard School of Public Health, reported Reuters, a co-sponsor of the event.

That pressure is especially acute in smaller communities, where consolidation among limited numbers of providers can "astronomically" increase prices, she said, according to Reuters. Constant federal oversight of antitrust behavior "is really appropriate," she added.

"It's great to know that the secretary of Health and Human Services recognizes that it's a real abiding tension between what the antitrust laws allow and where the Affordable Care Act is really pushing hospitals to go," Melinda Hatton, general counsel for the American Hospital Association, told Reuters.

In fact, the tension between gaining efficiencies through provider collaboration and controlling prices in a less competitive healthcare market was the subject of a General Accounting Office report issued last month at the request of Congress.

GAO found healthcare stakeholders disagreed on the effectiveness of antitrust guidance as it related to provider collaboration in three main areas: clinical integration, exclusive collaborative arrangements, and the size and scope of collaborative arrangements considered exempt from antitrust scrutiny, known as safety zones.

Meanwhile, the Federal Trade Commission continues pursuing antitrust actions against healthcare mergers it deems anticompetitive and likely to increase healthcare prices. Last month, for example, the FTC sued to prevent Idaho's largest hospital group from acquiring the state's largest physician group.

To learn more:
- read the Reuters article
- here's the GAO report (.pdf)

Related Articles:
Healthcare mergers don't improve quality, experts warn
With ACOs, there's a thin line between collaboration and monopoly
Fitch: Supreme Court merger ruling could hurt for-profit hospitals
Healthcare M&A takes post-reform spotlight
FTC Commissioner blasts ACOs


Thank You Fierce Healthcare and Ms Bird

Pharma Pay-To-Delay Foe Leibowitz Leaving FTC

It's a Rare occasion when we Salute a member of our Government swimming in this Ocean of Pharmaceutical Corruption. Sadly, This time, it's because we're Losing one of the good guys.

Fierce Pharma has;
Pharma Pay-To-Delay Foe Leibowitz Leaving FTC
Supreme Court will still take up the matter next month

February 1, 2013 | By Eric Palmer

FTC Chairman Jon Leibowitz, who has been a burr under the saddle of branded drug makers, is stepping down. That won't derail the U.S. Supreme Court from hearing a case next month over one of his favorite subjects, pay-to-delay arrangements. Under those deals, branded drug makers pay their generics-producing competitors a settlement in patent litigation to postpone launching copycats that will cut into profits. Just last month, the FTC put out a report claiming that the practice is costing taxpayers $3.5 billion a year. His fight against pay-to-delay was mentioned by the FTC as one of his biggest accomplishments in his four years as chairman. The lack of love between the FTC and the industry on this issue was evident when Generic Pharmaceutical Association(GPhA) CEO Ralph G. Neas responded to the FTC report with this: "The FTC is wrong on the facts, wrong on the public policy and wrong on the law." Release | More

Here's the FTC release:

FTC Chairman John Leibowitz To Step Down This Month

For Release: 02/01/2013

FTC Chairman Jon Leibowitz to Step Down This Month

After nearly four years as the head of the Federal Trade Commission, Chairman Jon Leibowitz today announced he will step down on February 15, 2013.  He has been a Commissioner since September 3, 2004.

Leibowitz, who became FTC chair in the wake of the economic downturn in March 2009,continued the agency’s groundbreaking work on consumer protection and competition issues.

“I have been honored to head this extraordinary, bipartisan Commission and to work alongside the best staff in federal government,” said Chairman Leibowitz.  “Our small but mighty agency has safeguarded the privacy of Americans and stopped predatory financial practices by companies taking advantage of cash-strapped consumers.  Our antitrust enforcement has helped contain health care and drug costs, and helped reduce prices and increase innovation for smartphones, computer chips and other high-tech products.”

Setting his priorities as protecting consumer privacy, stopping financial scammers, and promoting competition in health care and high-tech markets, Leibowitz steered the Commission to major enforcement actions and cutting-edge policy work.

In the past four years, enforcement has been a major priority at the FTC.  Most recently, the Commission announced a landmark agreement with Google to ensure consumers would continue to be able to buy a variety of high-tech devices from smartphones to games to tablets.  The settlement gives competitors access to standard-essential patents, and ensures that companies that advertise on Google’s website will have more flexibility to use rival search engines.

Protecting Consumer Privacy

During the last few years, Leibowitz has worked to raise the profile of privacy practices through law enforcement, consumer education and policy initiatives.  FTC settlement orders against Google and Facebook let the companies move on and innovate for consumers while requiring comprehensive privacy programs and affirmative choice for material privacy changes, and prohibiting privacy misrepresentations.

During Leibowitz’s tenure, the FTC issued a landmark report setting forth best privacy practices for businesses and updated the Children’s Online Privacy Protection Rule that strengthens kids’ privacy by requiring that companies get parents’ permission before collecting personal information from their children under 13.  The FTC’s final report on privacy endorsed three principles – privacy by design, greater transparency, and more consumer choice – to help ensure consumer privacy and business innovation.  The report encouraged businesses to improve their privacy practices through self-regulation, including a Do Not Track system, which remained a priority for Leibowitz.

Fighting Last Dollar Fraud

During Leibowitz’s tenure, the FTC has filed more than 50 law enforcement actions to stop “last dollar” scams that prey on consumers in financial distress, such as foreclosure “rescue” and mortgage modification schemes, phony debt-reduction and credit-repair services, and bogus government grant opportunities, job scams, and get-rich quick frauds, with many state Attorneys General as partners.

In 2011, as a result of one of the largest judgments imposed in an FTC settlement, the agency returned almost $108 million to more than 450,000 consumers – about 1 percent of all mortgage holders in the United States – who allegedly were overcharged or had their mortgage loans mishandled by Countrywide while they were in default or bankruptcy.  The company later settled charges that it illegally assessed more than $36 million of servicing fees against struggling homeowners, and agreed to refund or reverse all of those charges.

Promoting Competition in Health Care

Under Leibowitz’s leadership, the Commission continued to take aggressive, bipartisan action to stop sweetheart deals in which branded drug manufacturers allegedly paid potential generic rivals to delay their introduction of lower-cost pharmaceuticals – deals that the agency estimates cost consumers and taxpayers billions of dollars annually.  One of the FTC’s most important “pay-for-delay” cases, against an agreement that postponed generic competition for the testosterone-replacement drug AndroGel, will be argued before the Supreme Court on March 25, 2013.  In another recent case involving generic competition for the wakefulness drug Provigil, the Court of Appeals for the Third Circuit issued a key ruling that supports the FTC’s position on the anticompetitive impact of pay-for-delay deals.   

The FTC also continued its campaign to identify and challenge health care mergers that would harm competition and drive up the cost of health care for both consumers and employers.  The Commission has successfully acted to block hospital mergers in Pennsylvania, Ohio and Illinois, as well as deals to consolidate lab services and physician practices. The hospital merger victories marked a turning point for the government after years of disappointing court rulings in this area.  Another important FTC case in this area, challenging the merger of two hospitals in Albany, Georgia, also will be decided before the Supreme Court during the current term.

Trending in Technology

Another priority under Chairman Leibowitz was making sure that competition continued to thrive in fast-moving technology industries.  In addition to the settlement with Google, the Commission reached another landmark agreement that prevented Intel Corp. from suppressing competition in the market for computer chips and opened the door to renewed competition.  The settlement restored competition that was lost as a result of Intel’s previous anticompetitive tactics, while allowing the company to innovate and offer competitive pricing.

The FTC also took steps to rein in the alleged misuse of standard-essential patents, which can lead to patent hold-up and ultimately higher prices for popular devices such as smart phones, laptop and tablet computers, and gaming consoles.  The Commission made the case publicly – and through law enforcement actions such as the Google consent decree – that companies should be restricted from seeking injunctions on standard-essential patents if they are bound by prior commitments to license their standard-essential patents on fair, reasonable, and non-discriminatory terms.

In addition, the FTC launched an initiative to enhance its longstanding program to make sure the agency’s rules are up-to-date, effective and not overly burdensome.

In joining the Commission, Leibowitz resumed a long career of public service. He was the Democratic Chief Counsel and Staff Director for the U.S. Senate Antitrust Subcommittee from 1997 to 2000, where he focused on competition policy and telecommunications matters. He served as Chief Counsel and Staff Director for the Senate Subcommittee on Terrorism and Technology from 1995 to 1996 and the Senate Subcommittee on Juvenile Justice from 1991 to 1994.  In addition, he served as Chief Counsel to Senator Herb Kohl from 1989 to 2000. Leibowitz worked for Senator Paul Simon from 1986 to 1987.  In the private sector, Leibowitz served most recently as Vice President for Congressional Affairs for the Motion Picture Association of America – from 2000 to 2004 – and worked as an attorney in private practice in Washington from 1984 to 1986.

A Phi Beta Kappa graduate of the University of Wisconsin with a B.A. in American History (1980), Leibowitz graduated from the New York University School of Law in 1984.  He is a member of the District of Columbia Bar.

He lives in Bethesda with his wife, Ruth Marcus, and his two daughters.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

MEDIA CONTACT:

Office of Public Affairs
202-326-2180

Thank You Fierce Pharma, Mr Palmer, and Mr. Leibowitz.

For More, see Pharmalot:

Too Late For Pharma: FTC Chair Leibowitz Is Leaving

Pay-For Delay To Get Supreme Court Consideration

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Pay-For Delay To Get Supreme Court Consideration

With Justice Alito dropping out, a 4-4 tie is possible

December 10, 2012 | By Eric Palmer 

The U.S. Supreme Court will decide once and for all whether paying generic competitors to hold off on entering the market is legal. Or then again, maybe not. 

The court on Friday said it would take up the so-called pay-for-delay deals, but Justice Samuel A. Alito Jr. recused himself from hearing this case. That leaves open the possibility for a 4-4 tie, The New York Times points out.

The Supreme Court will consider a case in which the Federal Trade Commission went after Abbott Laboratories ($ABT) for paying Watson Pharmaceuticals ($WPI) and other generic drugmakers as much as $42 million a year to keep Solvay Pharmaceuticals' AndroGel treatment for low testosterone off the market for up to 8 years. Solvay is now owned by Abbott.

The FTC claimed the deal was anticompetitive and that these deals cost consumers $3.5 billion a year, Bloomberg reports. But drugmakers claim they are just protecting their investment and the patents that are already in place. Three courts sided with the drugmakers, but a court in Philadelphia found against them, setting up the need for a decision by the Supreme Court. Both sides would like to get the issue resolved. 

The FTC has been trying for years to change the practice, and cases have been brought against Bayer, Merck ($MRK), Bristol-Myers Squibb ($BMY), Watson Pharmaceuticals and Teva Pharmaceutical Industries ($TEVA), Bloomberg points out.

Action has heated up this year with CVS Caremark and Rite Aid filing a lawsuit over a deal between Pfizer's ($PFE) Wyeth unit and Teva Pharmaceutical Industries over Pfizer's blockbuster antidepressant Effexor XR. There has also been an effort afoot to approve legislation that would ban the practice. The American Medical Association recently said it supported that kind of law because it could help reduce healthcare costs. 

- read the New York Times story
- get more from Bloomberg
Related Articles:
Appeals court ruling threatens pay-to-delay deals 
Drugstores accuse Pfizer, Teva of blocking Effexor generics 
Appeals court ruling threatens pay-to-delay deals
Less cash, more promises in pay-to-delay deals
CBO: Pay-to-delay ban could save $4.8B


Thank You Fierce Pharma and Mr Palmer

FTC Opens Anti Trust on Healthcare Mergers

Fierce Healthcare has;
Anti-Trust Agencies Target Hospitals To Promote Competition

FTC challenged 17 of the 1,450 mergers reported in 2011

June 15, 2012 | By Alicia Caramenico

Aiming to preserve competition among healthcare providers and protect patients, the Federal Trade Commission challenged 17 of the 1,450 merger transactions reported in fiscal year 2011, with two involving hospitals. The healthcare targets were ProMedica and St. Luke's Hospital in Ohio and Phoebe Putney Health System and HCA-owned Palmyra Park Hospital in Albany, Ga., according to an annual report from the FTC and the U.S. Justice Department's Antitrust Division.


"These challenges … are part of the Commission's broader effort to promote competition in the healthcare sector, which benefits U.S. consumers with products and services that are lower cost and high quality," the report states.


The FTC scored a win last year when an administrative judge ruled that a partnership between ProMedica and St. Luke's Hospital was anticompetitive. This past March, the FTC said the health system must give up St. Luke's Hospital within six months. ProMedica plans to appeal to a federal court.



That anti-trust challenge follows the ongoing battle between the commission and Phoebe Putney and Palmyra Medical Center. Although a district court judge last year ruled in favor of the deal to move forward, the FTC recently called on the U.S. Supreme Court to review the hospital merger.


Worried that some mergers would stifle competition and hike up prices, the commission filed a complaint last year to halt an acquisition deal between Illinois health systems, OSF HealthCare and Rockford Health System. In April, the systems decided to call off the merger instead of enduring a lengthy and costly legal battle with the FTC.


However, the commission allowed Sanford Health in Fargo N.D., and Sioux Falls, S.D., to affiliate with North Dakota's Medcenter One health system, both organizations announced last month. The health systems noted that regulatory filings with the FTC and the North Dakota Attorney General's Office are going forward.
To learn more:

- read the FTC report (.pdf)
- here's the Medcenter statement (.pdf)
Related Articles:
Bigger hospitals, mergers drive higher prices
State calls for curbing high hospital prices with anti-trust laws
With ACOs, there's a thin line between collaboration and monopoly 
FTC targets hospital mergers


Thank You Fierce Healthcare and Ms Caramenico




And for those of you following our series on the San Francisco treat, http://psychroaches.blogspot.com/2012/06/mental-health-in-san-francisco.html while this next piece was written in 2004, and developments in Anti Trust are ongoing, it should serve as an appetizer.


Pepper Hamilton LLC has:
An Introduction To Anti Trust Exemptions And Immunities

State Action Immunity
The Supreme Court has held that, in keeping with principles of federalism, the federal antitrust laws do not reach actions of the sovereign states. When the government of a state acts, either through its legislature, judiciary, or executive, its actions are automatically exempted from antitrust liability.¹ For example, the U.S. Supreme Court held that the Arizona Supreme Court’s establishment of standards for admission to the practice of law was exempt from federal antitrust challenges.²


The state government’s immunity is quite broad. The immunity is not affected by whether the state action in question was illegal or the result of bribery.³ Nor will the state’s immunity be defeated because the state officials have conspired with private parties.⁴ With the “possible” exception of rare instances where the state is not acting in a regulatory capacity but as an actual participant in the market, “any action that qualifies as state action is ‘ipso facto . . . exempt from the operation of the antitrust laws.’”⁵


While actions taken directly by state governments are clearly exempt from antitrust scrutiny, “[c]loser analysis is required when the activity at issue is not directly that [of the state], but is carried out by others pursuant to state authorization.”⁶ The U.S. Supreme Court set forth different guidelines for exempting actions taken by municipal governments and by private actors under state authority. These materials will discuss them in turn.


Unlike state conduct, municipal government action is not automatically exempt from antitrust liability.⁷ 


As the U.S. Supreme Court explained:


These decisions require rejection of petitioners’ proposition that their status as such automatically affords governmental entities the “state action” exemption. [The] limitation of the exemption . . . to “official action directed by the state,” arises from the basis for the “state action” doctrine – that given our “dual system of government in which, under the Constitution, the states are sovereign, save only as Congress may constitutionally subtract from their authority,” a congressional purpose to subject to antitrust control the States’ acts of government will not lightly be inferred. To extend that doctrine to municipalities would be inconsistent with that limitation. Cities are not themselves sovereign; they do not receive all the federal deference of the States that create them. . . . In light of the serious economic dislocation which could result if cities were free to place their own parochial interests above the Nation’s economic goals reflected in the antitrust laws, we are especially unwilling to presume that Congress intended to exclude anticompetitive municipal action from their reach.<sup>8


Thank You Mr Bassman and Ms Sicalides</sup>


http://en.wikipedia.org/wiki/Johnson_and_Johnson

"The corporation includes some 250 subsidiary companies with operations in over 57 countries and products sold in over 175 countries"

250 subsidiaries in 57 countries. Anti Trust, ..... ?

Antitrust 101: FTC explains "Exclusion Payments Settlements"

ftc.gov has

PREPARED STATEMENT OF THE
FEDERAL TRADE COMMISSION
Before the
COMMITTEE ON THE JUDICIARY
of the
UNITED STATES SENATE
on
ANTICOMPETITIVE PATENT SETTLEMENTS
IN THE PHARMACEUTICAL INDUSTRY:
THE BENEFITS OF A LEGISLATIVE SOLUTION
January 17, 2007

True, free markets, are the only solution to Healthcare Costs.