Veteran antitrust attorney K. Todd Wallace comments on Atrium Health anti-steering case

NEW ORLEANS - Dec. 11, 2018 - PRLog -- Attorney K Todd Wallace published a new comment on his blog, involving complex antitrust legal arguments. The complete comment will be available on Mr. Wallace's blog.

The U.S. Department of Justice announced that it has reached a settlement with Atrium Health, submitting a proposed settlement for court approval in a case that has been ongoing since 2016.  At issue in the case was Atrium Health's use of anti-steering provision in its contracts with health insurance companies.  As explained by the DOJ in its press release announcing the settlement, "[t]he Department alleged that Atrium, the dominant hospital system in the Charlotte area, used its market power to restrict health insurers from encouraging consumers to choose healthcare providers that offer better overall value. The restrictions also constrained insurers from providing consumers and employers with information regarding the cost and quality of alternative health benefit plans."  If approved, the settlement would enjoin Atrium Health from seeking to enforce the anti-steering provision against health insurers and also prohibit including such provision in its contract with insurers in the future.

The settlement represents an interesting development in light of the recent U.S. Supreme Court decision in Ohio v. American Express.  In the American Express case, the Supreme Court held that anti-steering provision in a two sided-market must be evaluated as a whole.  Many legal scholars saw this development as potentially having significant effect on the analysis of how other multiparty-market antitrust cases would be evaluated, such as those involving the health insurance industry.

It appears that the DOJ satisfied the whole market approach as required by American Express, at least at the initial pleading stage.  Although one can only speculate as to what ultimately motivated the parties to settle, it would be reasonable to assume that the dual harm alleged by the DOJ could have played a factor the decision rather than pursue its 12(c) motion to the end.

Kenneth Todd Wallace is an attorney and founding partner of the law firm Wallace Meyaski LLC. He has nearly 20 years of experience in the legal and business professions with established excellence in trial advocacy, negotiation, strategic and initiative planning, employment law compliance, government relations, mergers and acquisitions, and team building.

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