In what could be a precedent-setting case, five Idaho orthopedists have settled an antitrust suit launched by the U.S. Department of Justice which alleged the doctors conspired against Idaho’s Industrial Commission to obtain higher pay for their services in treating workers compensation patients.
According to S. M. Oliva, a legal expert at the Ludwig von Mises Institute, the case is “shocking” not because of the subject matter but because it was the Department of Justice (DOJ) that filed suit against the doctors, not the Federal Trade Commission (FTC).
“It has been part of a longstanding federal antitrust policy dating back to 1996 to sue doctors who do this, but what is particular about this case is the involvement of the DOJ,” Oliva said. “The FTC has been prosecuting doctors for these actions for well over a decade on essentially the same charges as the DOJ has trumped up on these Idaho doctors. That makes this a disturbing development.”
Doctors Could Face Prison Time
Oliva is concerned about the DOJ’s capabilities in threatening doctors’ livelihoods if such lawsuits are no longer limited to the purview of the FTC.
“The FTC can only bring administrative and civil litigation, but the DOJ has both civil and criminal [authority], such as declaring what these doctors did is an act of price fixing, which is both a criminal and a civil offense,” Oliva said. “The concern here is that in future cases the DOJ could say to doctors, ‘You’d better agree to our demands to settle this case in civil court, or we will go to a grand jury and indict you for price fixing,’ in which case those doctors would be facing the threat of prison time.”
Seen as Intimidation Tactic
John Dunn, a physician in Fort Hood, Texas, believes the unusual involvement of the DOJ could signal the U.S. government intends to start suing more of the nation’s doctors, alleging criminal price fixing and antitrust activity, as a means of forcing physicians to cut their prices.
“This is an example of physicians, who practice in our society as licensed professionals, being accused of monopolistic behavior in order to bring them to heel,” Dunn said. “Simply by demanding they be paid at market rates, physicians can now be accused of illegal behavior through new interpretations of antitrust laws. Washington has decided to control what previously was a free market activity with new impositions and regulations. Physicians who try to get around those regulations will be punished.”
Dunn believes DOJ’s involvement in the Idaho case was a sign of expanded government action against physicians in the future.
“Civil actions make more sense—lower penalties, and a lower burden of proof—but criminal actions against doctors create a psychological advantage,” Dunn said. “Idaho just happened to be a convenient target of opportunity. I fully expect the government to use this strategy to intimidate doctors around the country.”
Thomas Cheplick ([email protected]) writes from Cambridge, Massachusetts.