Thursday, January 6, 2011
NOT GOOD ENOUGH FOR GOVERNMENT WORK: GEOGRAPHIC MARKET DEFINITION AND THE FTC'S CASE AGAINST CHICAGOLAND PHYSICIAN ASSOCIATIONS
Posted by D. Daniel Sokol
Gregory D. Adams (CRA) and Fred S. McChesney (Northwestern Law) describe NOT GOOD ENOUGH FOR GOVERNMENT WORK: GEOGRAPHIC MARKET DEFINITION AND THE FTC'S CASE AGAINST CHICAGOLAND PHYSICIAN ASSOCIATIONS.
ABSTRACT: In the past decade, the Federal Trade Commission has brought many cases opposing joint contracting by independent practice associations (IPAs), including a high-profile case against the Evanston Medical Group IPA in suburban Chicago. The FTC frequently claims that such contracting is per se illegal. This article criticizes the FTC's approach to evaluating joint contracting by IPAs. As described herein, joint contracting by IPAs have potential precompetitive benefits, as well as potential anticompetitive costs. Thus, rule of reasons treatment is appropriate. This article also describes issues related to market definition and market power under such a rule of reason analysis.