What did Mac say that qualified as mic-drop?
Much better write up of the point and question he was making
The ACEP23 Closing Session featured a tireless advocate of emergency physician autonomy face-to-face with a fierce opponent of corporate monopolization. Bob McNamara, MD, founder of AAEM, was at the microphone, while Lina Khan, Chair of the Federal Trade Commission, was broadcast on a massive screen. Dr. McNamara asked Chair Khan if the American College of Emergency Physicians would violate US antitrust laws by excluding employers from its conference exhibit hall for not abiding by ACEP policies.
McNamara's underlying question was: could ACEP kick out Envision, TeamHealth, Sound, and SCP from its trade show because private equity firms own them? Dr. McNamara received rousing applause from the audience. In response, Khan answered the question she wanted to be asked, not the one that was asked. Since Lina Khan didn’t answer, let’s dig into it.
When considering whether trade associations’ actions violate US antitrust laws, the Federal Trade Commission and Department of Justice use the “rule of reason.” Per the DOJ: “Under the ‘rule of reason,’ the courts must undertake an extensive evidentiary study of (1) whether the practice in question in fact is likely to have a significant anticompetitive effect in a relevant market and (2) whether there are any procompetitive justifications relating to the restraint. Under the ‘rule of reason,’ if any anticompetitive harm would be outweighed by the practice’s procompetitive effects, the practice is not unlawful.”
In other words, a trade association’s action that meaningfully limits competition within a market would violate the Sherman Act unless that action promotes competition in some other way.
The law firm Venable summarizes, “The courts and antitrust enforcement agencies (the U.S. Department of Justice and the Federal Trade Commission) generally have agreed that the mere existence of membership qualifications and standards is not unreasonable. On the other hand, restrictions that restrain competition or impose unreasonable restraints may be viewed as prohibited ‘group boycotts’ or ‘concerted refusals to deal.’”
The FTC sent a detailed letter to ACEP on this topic in 2004. ACEP solicited the letter to clarify the legality of the 2003 Council Resolution, “Certificate of Compliance.” The resolution included the following:
That ACEP will require emergency physician staffing groups to sign the following certificate and to comply with its terms as a prerequisite for their participation as an exhibitor or sponsor in any of the College activities and venues: “I confirm/certify that all of the following are true”:
1. With the provisional period not to exceed one year, our physician group provides our emergency physicians access to predefined due process. Our physician group, or its controlling entity, has a predefined mechanism that regularly and automatically provides all our emergency physicians the detail of their own professional charges and collections. This information shall be automatically provided to the physician on a quarterly basis.
2. Our physician group provides our emergency physicians: a) a predefined and reasonable pathway to full partnership that does not exceed three years, b) the review process and criteria used to grant full partnership, c) a predefined entry and exit policy, and d) the exact distribution of all shares held in the group. For the purpose of this certificate, a full partner is defined as an equal shareholder with equal voting status.
3. Our physician group, or its controlling entity, has a predefined mechanism that regularly and automatically provides all full partners: a) the total charges and collections for the group, and b) the distribution of all group income including all management and operational expenses including coding/billing/collecting, professional liability insurance, non-physician employee salaries, and physician administrative stipends. This information shall be automatically provided to the partners on a quarterly basis.
4. Our physician group provides our emergency physicians with the details of our governance process including the method of electing leaders and new partners, appointing medical directors and administrators and revising the bylaws.
5. Our physician group does not impose post-contractual restrictive covenants (i.e., non-compete clauses).
6. Our physician group, or its controlling entity, is wholly owned by practicing physicians.
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Advocates of physician practice ownership would recognize these six elements as foundational to the battle against the corporate practice of medicine.
Key portions of the Federal Trade Commission letter to ACEP:
“The resolutions would establish rules concerning business practices of physician groups or firms that provide emergency physician services to hospital emergency departments (emergency physician staffing organizations). The proposed rules appear capable of harming competition in the provision of those services, and thus raise antitrust issues.”
“An antitrust analysis would consider both: (1) whether the exclusion of non-complying entities from ACEP activities and publications would likely have a significant effect on the ability of those firms to recruit emergency physicians and thus to compete in the market; and (2) whether the intent or likely effect of adoption of the rule would be to orchestrate an agreement among competing physicians to adhere to the prescribed model. The resolution advises members that they "need to work together to shape the practice environment." and further states that "[t]urning policy into practice is essential." It may be that the resolution is designed to suppress certain models for providing emergency department services, and thereby to restrict competition among emergency medicine providers.”
“Agreements among ACEP members not to do business except on the terms contained in the resolution, or a direct ACEP prohibition of its members' accepting employment on non-conforming terms, would raise serious antitrust concerns.”
Would raise serious antitrust concerns is lawyer-speak for, if you try to do this, you’ll end up in court.
Dr. McNamara responded to the FTC’s 2004 letter with an article published through AAEM. He wrote, “There are various ways to interpret this FTC opinion. ACEP has apparently chosen to take this matter as a chance to reinforce their fears about the antitrust boogey man.”
The Federal Trade Commission is no antitrust boogeyman. Google, Amazon, US Anesthesia Partners, health systems, and others are finding out the hard way that violating US antitrust laws has serious consequences.
The bottom line answer to Dr. Bob McNamara’s ACEP23 question to Lina Khan: banning private equity-owned emergency medicine groups from ACEP conferences or exhibit halls because most ACEP members disagree with those firms’ business models would violate US antitrust law.
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