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Antitrust Ruling Could Impact State Regulatory Boards

John Commins, for HealthLeaders Media, June 21, 2013

Jay Levine, a healthcare antitrust attorney with the Washington, D.C.–based firm of Bradley Arant Boult Cummings LLP, says the ruling has broader implications for all state regulatory boards that attempt to limit competition. 

"What the board was doing here was essentially restricting competition by sending cease-and-desist letters to purveyors of teeth-whitening services saying 'what you are doing is illegal' and thereby driving them from the market, which all inured to these dentists' competitive benefit," Levine says.  

"The essential ruling of the Fourth Circuit was affirming the FTC's complaint that because the North Carolina dental board was comprised for the most part of practicing dentists who were elected by practicing dentists , they were considered a private actor and not a governmental entity," Levine says. "Therefore they needed to meet both prongs of the Midcal test, which are a clearly articulated state policy to displace competition plus active supervision of the state over the private parties' conduct."

"If the board is not acting in a collusive manner then they may be entitled to some other protection … because Section 1 of the Sherman Act requires that there be concerted activities between two economic actors. The Fourth Circuit rejected that line of reasoning in the North Carolina dental case because it essentially said 'here you have a bunch of different actors with different economic interests engaging in conduct designed to promote their individual economic interests.' "

Levine says state oversight boards with concerns about their immunity from antitrust complaints should probably review how they are comprised and how they do business.

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