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From Antitrust Law Daily, November 5, 2013

Chiropractors’ New Jersey monopolization claims fail against health insurer

By Tobias J. Gillett, J.D., LL.M.

New Jersey chiropractors failed to state antitrust claims against a health insurer and a benefit management firm over the insurer’s policy limiting the kinds of imaging services that it would reimburse, a New Jersey Appellate Division court has ruled (The Association of New Jersey Chiropractors, Inc. v. Horizon Healthcare Services, Inc., November 4, 2013, Ostrer, M.).

Two chiropractors and a non-profit association of chiropractors challenged Horizon Blue Cross Blue Shield of New Jersey, Inc.’s “privileging policy,” under which Horizon limited the kinds of diagnostic imaging services that it would reimburse. The policy allegedly restricted the chiropractors from performing various imaging studies they were licensed to perform, even though other specialists were permitted to perform those studies. Among other claims, the chiropractors alleged a violation of the monopolization provision of the New Jersey Antitrust Act.

The chiropractors alleged that Horizon possessed a dominant share of the health insurance market, and had “the market power to set artificially low reimbursement rates and to restrict the output and reimbursement of health care providers who participate in the Horizon plans.” The chiropractors also alleged that benefit management firm Care Core National, LLC, which helped design the privileging policy, “acted in concert with Horizon and shared in Horizon’s market power.”

The trial court granted summary judgment to the defendants and dismissed the complaint with prejudice, finding that the chiropractors failed to allege sufficient facts to support their antitrust claims. The chiropractors appealed.

The appellate court affirmed the trial court’s decision as to the monopolization claims. The court observed that, although the chiropractors alleged that Horizon insured 3.6 million people, they failed to define the relevant market or to allege or prove that Horizon had sufficient market share to monopolize or attempt to monopolize the market. Nor did the chiropractors allege or present sufficient evidence to demonstrate that the defendants had willfully acquired monopoly power or had the specific intent to monopolize. The court noted that “a health insurer’s alleged use of market power to obtain discounts for its customers from health care providers does not constitute willful acquisition or maintenance of monopoly power for purposes of a” monopolization claim.

Moreover, the chiropractors were sellers of health care services that were reimbursed by Horizon, not sellers of health insurance in competition with Horizon. The court saw nothing in Horizon’s alleged unfavorable treatment of chiropractors that could be seen as excluding competition in the relevant market. Rather, Horizon’s limitation on reimbursement for imaging services appeared to create an opportunity for a competitor to increase its share of the market by providing more comprehensive benefits. Therefore, the court affirmed the trial court’s dismissal of the antitrust claims with prejudice.

The case is No. A-6033-11T4.

Attorneys: Jeffrey B. Randolph (Law Office of Jeffrey Randolph, L.L.C.) for The Association of New Jersey Chiropractors. Andrew O. Bunn (DLA Piper LLP) for Horizon Blue Cross Blue Shield of New Jersey, Inc. David E. Sellinger (Greenberg Traurig, LLP) for Care Core National, LLC.

Companies: The Association of New Jersey Chiropractors; Horizon Blue Cross Blue Shield of New Jersey, Inc.; Care Core National, LLC

MainStory: TopStory Antitrust NewJerseyNews

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