“The Task Force will identify and eradicate monopolies and collusive practices that create higher costs, lower quality and single points of failure in the health care industry.”
– Assistant Attorney General Jonathan Cantor
On May 9, 2024, the Department of Justice (DOJ) Antitrust Division announced a new Task Force on Healthcare Monopolies and Collusion (HCMC). Comprised of civil and criminal prosecutors, economists, healthcare industry experts, technologists, data scientists, researchers, and policy advisors, the goal of the HCMC Task Force is to “root out monopoly and collusive behavior” in the healthcare industry.
The task force will conduct both civil and criminal investigations into alleged unfair competition in what the Antitrust Division is calling a “whole of the division” and “whole of government” approach to health care antitrust issues. This is the latest example of the Biden administration’s increased scrutiny of business practices it believes may violate antitrust laws, and it will undoubtedly rely heavily on data analytics as part of its early investigative efforts.
According to the Department of Justice, the task force will focus on several key areas.
- “A multi-faceted giant” The Task Force will focus on what the Department of Justice has labeled “multifaceted giants” – vertically integrated “payer providers” that have taken advantage of the “platformization” of health care to “stack” different elements of the health care industry together to form integrated conglomerates that include payers, providers, PBMs, claims processors, and banks.
- Rapid accumulation of healthcare assets. The Ho Chi Minh City task force will also focus on companies that have acquired multiple medical assets – “rapid asset” firms that the Justice Department says act as de facto “gatekeepers” in the health care industry, restricting competition.
- Coordination with other government agencies. The task force is not limited to the Antitrust Division, but will work with and coordinate with other government agencies to apply multiple investigative tools to suspected anticompetitive conduct in the health care industry. The Antitrust Division has made health care antitrust enforcement a top priority and has signaled a department-wide effort to enforce non-antitrust misconduct discovered during antitrust investigations.
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- Review recent M&A activity. The Department of Justice has expressed interest in vertically integrated “paywall” companies that take advantage of the “platformization” of health care and “stack” various health care industry components. Safe Harbor Companies should carefully assess their due diligence and involve compliance professionals to voluntarily disclose issues identified during the course of an M&A transaction and mitigate transaction risks.
- Reviews books and records. Reviewing your company’s billing practices and assessing whether they are in line with best practices can help you determine whether your company is at risk for increased DOJ scrutiny.
- Be careful with your data analysis. The DOJ appears particularly interested in taking enforcement actions against organizations whose business practices have negatively impacted patient care. Data analytics plays a large role in DOJ investigations. Reviewing the care provided to ensure it complies with best practices and industry standards is a strong defense against potential government enforcement actions.
- Address any concerns promptly. The Department of Justice made important proposals. Incentives Urge whistleblowers and companies to disclose potential wrongdoing. Over the past two years, the Department of Justice has announced numerous policy changes regarding corporate criminal enforcement, many of which were based on what it calls a “carrot and stick” approach (a combination of incentives and deterrence). However, companies have a short window of opportunity to take advantage of these programs. Therefore, consulting with counsel when a problem arises or when you anticipate a problem will be important to evaluate next steps. Whether to conduct an internal investigation, develop or improve an effective compliance program, or evaluate whether voluntary self-disclosure is in the company’s best interest, these are all decisions that must be made quickly.
