FTC Challenges Illegal Boycott of Health Plan by Connecticut Chiropractors

The Federal Trade Commission today announced its decision to challenge the conduct by two Connecticut chiropractic associations and one of their attorneys to implement a collective refusal to deal with a cost-saving health plan in Connecticut. The FTC’s complaint charged that the parties’ actions unreasonably restrained competition in violation of Section 5 of the FTC Act. In settling the FTC’s charges, the parties will refrain from engaging in such anticompetitive conduct in the future.

“Group boycotts by health care providers eliminate competition and raise health care costs to consumers,” said Jeffrey Schmidt, Director of the FTC’s Bureau of Competition. “The action announced today will prevent the recurrence of such conduct and preserve the benefits of competition for chiropractic patients in Connecticut.” Mr. Schmidt also expressed appreciation to Connecticut’s Office of the Attorney General, whose staff worked closely with the FTC’s Bureau of Competition in this investigation.

The FTC’s complaint alleges that the Connecticut Chiropractic Association (CCA), the Connecticut Chiropractic Council (CCC), and Robert L. Hirtle (CCA’s legal counsel) conspired through a campaign of meetings and other communications to encourage and facilitate a collective refusal to deal with American Specialty Health (ASH). The purpose and effect of the boycott was to prevent ASH from providing its cost-saving chiropractic benefits administration program in Connecticut. According to the FTC, the challenged conduct had no legal justification and, thus, was a naked boycott among competitors and a clear per se violation of the antitrust laws.

The proposed consent order prohibits the parties from entering into, or facilitating, any agreement among chiropractors: (1) to negotiate with payors on any chiropractor’s behalf; (2) to deal, not to deal, or threaten not to deal with payors; or (3) on what terms to deal with payors.

The Commission vote to accept the proposed consent agreement was 5-0. The FTC will publish an announcement regarding the agreement in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning today and continuing through April 4, after which the Commission will decide whether to make it final. Comments should be addressed to the FTC, Office of the Secretary, Room H-135, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC is requesting that any comment filed in paper form near the end of the public comment period be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions.

NOTE: A consent agreement is for settlement purposes only and does not constitute an admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of $11,000.

Copies of the complaint, consent order, an analysis to aid in public comment are available from the FTC’s website, http://www.ftc.gov, and its Consumer Response Center, Room 130, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580. The FTC’s Bureau of Competition seeks to prevent business practices that restrain competition. The Bureau carries out its mission by investigating the alleged law violations and, when appropriate, recommending that the Commission take formal enforcement action. To notify the Bureau concerning particular business practices, write the Office of Policy and Evaluation, Room 394, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580, or antitrust@ftc.gov, or call (202)326-3300. For more information on the laws that the Bureau enforces, the Commission has published Promoting Competition, Protecting Consumers: A Plain English Guide to Antitrust Laws, available at http://www.ftc.gov/bc/compguide/index.htm. For more information on the FTC/s antitrust actions in health care, see http://www.ftc.gov/bc/bchealthcare.htm.