Washington State Attorney General Bob Ferguson announced that Tacoma, Washington-based CHI Franciscan will pay up to $2.5 million to resolve a federal antitrust lawsuit that was previously filed against the non-profit health system.
CHI Franciscan Settles $2.5M Antitrust Suit
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Secondary#antitrust#chifranciscan#westsoundorthopaedics
In 2017, Ferguson filed a lawsuit against CHI Franciscan and its affiliates, alleging violations of the Sherman Act, the Clayton Act, and the Washington Unfair Business Practices-Consumer Protection Act.
Ferguson filed the lawsuit after CHI Franciscan acquired the assets of WestSound Orthopaedics in Silverdale, Washington, and announced an affiliation with The Doctors Clinic, a multi-specialty practice with seven locations in Kitsap County, Washington.
These deals combined the three largest providers of orthopedic services in the Kitsap area, which greatly reduced Kitsap residents’ options when they sought services close to home. This meant that the thousands of Kitsap area residents who sought orthopedic services would face higher prices, increased wait times, a reduction in their choice of services and locations, and increased difficulty in scheduling procedures.
“CHI Franciscan’s actions unlawfully decreased competition and increased prices at the expense of patients,” Ferguson said. “Today’s agreement holds CHI Franciscan accountable for putting its bottom line ahead of the people on the Kitsap Peninsula.”
The money from the settlement will be distributed to health clinics and organizations to increase access to health care service for the Kitsap Peninsula area.
As part of the agreement, CHI Franciscan is required to divest its controlling interest in an outpatient surgery center that it acquired in Silverdale and notify the Attorney General’s Office of any future deals that could decrease competition.
There was no judgement or admission on anti-competitiveness. The court previously dismissed the other claims filed by the Attorney General, including claims against the health system for affiliating with WestSound Orthopaedics.
The Honorable Benjamin H. Settle of the United States District Court for the Western District of Washington presided over the case.
For more OTW coverage of the CHI Franciscan antitrust suit, see our article here: CHI Franciscan Settles Antitrust Lawsuit.
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This is a fascinating development. In my practice we've seen similar outcomes with the revised protocol. The key differentiator seems to be patient selection criteria. Has anyone else noticed the correlation with BMI thresholds?
Great point. I'd push back slightly on the conclusion, the sample size in the cited study is too small to draw population-level inferences. That said, the directional signal is compelling and worth a larger RCT.
We implemented a similar approach last year. Early results are promising but we're still gathering 12-month follow-up data. Happy to share our protocol if anyone is interested.
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