[Federal Register Volume 59, Number 13 (Thursday, January 20, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-1372]
[[Page Unknown]]
[Federal Register: January 20, 1994]
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FEDERAL TRADE COMMISSION
[File No. 911 0121]
McLean County Chiropractic Association; Proposed Consent
Agreement With Analysis To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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SUMMARY: In settlement of alleged violations of federal law prohibiting
unfair acts and practices and unfair methods of competition, this
consent agreement, accepted subject to final Commission approval, would
prohibit, among other things, an association of Illinois chiropractors
from agreeing to set fees for patients, or terms for third-party payor
contracts, and would require the association to give members copies of
the settlement.
DATES: Comments must be received on or before March 21, 1994.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT:Mark Horoschak, FTC/S-3115, Washington,
DC 20580. (202) 326-2756.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the
Commission's Rules of Practice (16 CFR 2.34), notice is hereby given
that the following consent agreement containing a consent order to
cease and desist, having been filed with and accepted, subject to final
approval, by the Commission, has been placed on this public record for
a period of sixty (60) days. Public comment is invited. Such comments
or views will be considered by the Commission and will be available for
inspection and copying at its principal office in accordance with
Sec. 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR
4.9(b)(6)(ii)).
Agreement Containing Consent Order To Cease and Desist
In the matter of McLean County Chiropractic Association, an
unincorporated association.
The Federal Trade Commission having initiated an investigation of
certain acts and practices of proposed respondent named in the caption
hereof, and it now appearing that proposed respondent is willing to
enter into an agreement containing an order to cease and desist from
the use of the acts and practices being investigated,
It is hereby agreed by and between proposed respondent and their
attorney, and counsel for the Federal Trade Commission that:
1. Proposed respondent is an unincorporated association, with its
principal offices and places of business in McLean County, Illinois.
For purposes of this agreement and order, its address is as follows:
McLean County Chiropractic Association, c/o George R. Flynn, Esq., P.O.
Box 3574, Bloomington, IL 61702-3574.
2. Proposed respondent admits all the jurisdictional facts set
forth in the draft of complaint here attached.
3. Proposed respondent waives:
(a) Any further procedural steps;
(b) The requirement that the Commission's decision contain a
statement of findings of fact and conclusions of law;
(c) All rights to seek judicial review or otherwise to challenge or
contest the validity of the order entered pursuant to this agreement;
and
(d) Any claim under the Equal Access to Justice Act.
4. This agreement shall not become part of the public record of the
proceeding unless and until it is accepted by the Commission. If this
agreement is accepted by the Commission it, together with the draft of
complaint contemplated thereby, will be placed on the public record for
a period of sixty (60) days and information in respect thereto publicly
released. The Commission thereafter may either withdraw its acceptance
of this agreement and so notify proposed respondent, in which event it
will take such action as it may consider appropriate, or issue and
serve its complaint (in such form as the circumstances may require) and
decision, in disposition of the proceeding.
5. This agreement is for settlement purposes only and does not
constitute an admission by proposed respondent that the law has been
violated as alleged in the draft of complaint here attached.
6. This agreement contemplates that, if it is accepted by the
Commission, and if such acceptance is not subsequently withdrawn by the
Commission pursuant to the provisions of Sec. 2.34 of the Commission's
Rules, the Commission may, without further notice to proposed
respondent, (1) issue its complaint corresponding in form and substance
with the draft complaint here attached and its decision containing the
following order to cease and desist in disposition of the proceeding
and (2) make information public in respect thereto. When so entered,
the order to cease and desist shall have the same force and effect and
may be altered, modified or set aside in the same manner and with the
same time provided by statute for other orders. The order shall become
final upon service. Delivery by the U.S. Postal Service of the
complaint and decision containing the agreed-to order to proposed
respondent's addresses as stated in this agreement shall constitute
service. Proposed respondent waives any right it may have to any other
manner of service. The complaint may be used in construing the terms of
the order, and no agreement, understanding, representation, or
interpretation not contained in the order or the agreement may be used
to vary or contradict the terms of the order.
7. Proposed respondent has read the proposed complaint and order
contemplated hereby. It understands that once the order has been
issued, it will be required to file one or more compliance reports
showing that it has fully complied with the order. Proposed respondent
further understands that it may be liable for civil penalties in the
amount provided by law for each violation of the order after the order
becomes final.
Order
I
It is ordered, That for purposes of this order, the following
definitions shall apply:
A. ``Respondent MCCA'' means McLean County Chiropractic Association
and its Board of Directors, committees, officers, representatives,
agents, employees, successors, and assigns.
B. ``Payor'' means any person that purchases, reimburses for, or
otherwise pays for health care services for themselves or for any other
person--including, but not limited to, health insurance companies;
preferred provider organizations; prepaid hospital, medical, or other
health service plans; health maintenance organizations; government
health benefits programs; employers or other persons providing or
administering self-insured health benefits programs; and patients who
purchase health care for themselves.
C. ``Integrated joint venture'' means a joint arrangement to
provide health care services in which all chiropractors participating
in the venture who would otherwise be competitors (1) pool their
capital to finance the venture, by themselves or together with others,
and (2) share a substantial risk of loss from their participation in
the venture.
D. ``Case fee'' means the aggregate total of all fees charged to a
patient for the full course of treatment for a medical condition or
combination of medical conditions. ``Case fee'' does not mean a fee
charged for a particular product or service.
II
It is further ordered, That respondent MCCA directly or indirectly,
or through any device, in connection with activities in or affecting
commerce, as ``commerce'' is defined in the Federal Trade Commission
Act, as amended, do forthwith cease and desist from:
A. Entering into, attempting to enter into, organizing, continuing,
or acting in furtherance of any agreement or combination, express or
implied, with any chiropractors or among any chiropractors, to discuss
or collectively determine the fees which chiropractors charge to
payors; and
B. Entering into, attempting to enter into, organizing, continuing,
or acting in furtherance of any agreement or combination, express or
implied, with any chiropractors or among any chiropractors, to deal
with payors on collectively determined terms.
Provided, That, nothing in this order shall prevent chiropractors
who practice together as partners or employees in the same professional
corporation or partnership from collectively determining the fees to be
charged for services provided by that professional corporation or
partnership or from collectively determining other terms on which that
professional corporation or partnership deals with payors.
Further provided, That, nothing in this order shall prevent
chiropractors who participate in the same integrated joint venture from
collectively determining the fees to be charged for services provided
by that integrated joint venture or from collectively determining other
terms on which that integrated joint venture deals with payors.
Further provided, That, nothing in this order shall prevent
respondent MCCA from collecting historical data concerning case fees
for the purpose of providing such data to payors.
III
It is further ordered, That respondent MCCA:
A. File a written report with the Commission within ninety (90)
days after the date when the order becomes final, and annually for
three (3) years on the anniversary of the date when the order becomes
final, and at such other times as the Commission may by written notice
to respondent MCCA require, setting forth in detail the manner and form
in which it has complied and is complying with the order.
B. For a period of five (5) years after the date when the order
becomes final, maintain and make available to Commission staff, for
inspection and copying upon reasonable notice, records adequate to
describe in detail any action taken in connection with the activities
covered by Parts II and III of this order, including, but not limited
to, all documents generated by respondent MCCA or that come into its
possession, custody, or control, regardless of source, that discuss,
refer, or relate to any fee, term, or condition of any agreement,
actual or proposed, with any payor.
C. Distribute by first-class mail a copy of this order to each of
its members within thirty (30) days after the date when the order
becomes final.
D. For a period of five (5) years after the date when the order
becomes final, provide each new MCCA member with a copy of this order
at the time the member is accepted into membership.
E. Notify the Commission, at least thirty (30) days prior to any
proposed change to respondent MCCA which may affect compliance with
this order--including, but not limited to, dissolution or the emergence
of a successor.
McLean County Chiropractic Association Analysis of Proposed Consent
Order To Aid Public Comment
The Federal Trade Commission has accepted, subject to final
approval, the agreement to a proposed consent order from McLean County
Chiropractic Association (``MCCA''). The agreement settles charges by
the Federal Trade Commission that MCCA restrained competition by, among
other things, combining or conspiring both (1) To fix the maximum fees
charged by MCCA members and (2) to negotiate the terms and conditions
of agreements between MCCA members and third-party payors.
The proposed consent order has been placed on the public record for
sixty (60) days for reception of comments by interested persons.
Comments received during this period will become part of the public
record. After sixty (60) days, the Commission will again review the
agreement and the comments received and will decide whether it should
withdraw from the agreement or make final the agreement's proposed
order.
The purpose of this analysis is to facilitate public comment on the
agreement. The analysis is not intended to constitute an official
interpretation of either the proposed complaint or the proposed consent
order or to modify their terms in any way.
The Complaint
Under the terms of the agreement, a proposed complaint would be
issued by the Commission along with the proposed consent order. The
proposed complaint alleges that MCCA has thirteen members, of whom all
are chiropractors with offices in McLean County, Illinois. MCCA's
members compete among themselves and with other chiropractors to offer
chiropractic services in and around McLean County.
The complaint further alleges that MCCA acted as a combination of
its members, conspired with at least some of its members, and acted to
implement an agreement among its members to restrain competition among
chiropractors in McLean County, Illinois, and its vicinity. Such
actions included facilitating, entering into, and implementing an
agreement under which
A. MCCA would set the maximum fees to be charged by MCCA members;
and
B. MCCA would negotiate agreements between its members and third-
party payors, including the fees to be paid to MCCA members under such
agreements.
In furtherance of this combination or conspiracy, MCCA periodically
voted to raise such limits on maximum fees, and attempted to negotiate
such agreements between its members and third-party payors.
The complaint alleges that the above actions of MCCA had, or had
the tendency and capacity to have, the following effects:
A. Restraining competition among chiropractors in McLean County,
Illinois, and its vicinity;
B. Fixing or affecting the fees that chiropractors in McLean
County, Illinois, and its vicinity charge for their services; and
C. Depriving consumers of chiropractic services and third-party
payors of the benefits of competition among chiropractors in McLean
County, Illinois, and its vicinity.
Finally, the complaint alleges that the above actions of MCCA
constitute unfair methods of competition in violation of Section 5 of
the Federal Trade Commission Act, 15 U.S.C. 45.
The Proposed Consent Order
The proposed consent order would prohibit MCCA from entering into,
organizing, or acting in furtherance of, any agreement or combination
with or among chiropractors.
A. To discuss or set the fees to be charged by chiropractors, or
B. To deal on collectively determined terms with anyone who pays
for health services,
The order specifically provides that it does not prevent the
following:
1. Chiropractors who practice together as partners or employees in
the same professional corporation or partnership collectively
determining the fees to be charged by that professional corporation or
partnership.
2. Chiropractors who participate in the same integrated joint
venture collectively determining the fees to be charged by that
integrated joint venture. (For purposes of the consent order,
``integrated joint venture'' means a joint arrangement to provide
health care services in which all chiropractors participating in the
venture would otherwise be competitors (1) pool their capital to
finance the venture, by themselves or together with others, and (2)
share a substantial risk of loss from their participation in the
venture.)
3. The collection of historical data concerning case fees for the
purpose of providing such data to those who pay for health services.
(For purposes of the consent order, ``case fee'' means the aggregate
total of all fees charged to a patient for the full course of treatment
for a medical condition or combination of medical conditions, and does
not mean a fee charged for a particular product or service.)
The order would require MCCA to distribute copies of the order to
its members and, for five years, to its new members when they join
MCCA.
The order also requires MCCA to (1) file compliance reports with
the Commission, (2) maintain certain files relating to MCCA's
compliance with the order, and (3) notify the Commission of any
proposed change in MCCA that may affect MCCA's compliance with the
order.
MCCA agreed to the order for settlement purposes only, and MCCA's
agreement to the order does not constitute an admission by MCCA that
the law has been violated as alleged in the complaint.
Donald S. Clark,
Secretary.
[FR Doc. 94-1372 Filed 1-19-94; 8:45 am]
BILLING CODE 6750-01-M
