“The task force will identify and root out monopolies and collusive practices that increase costs, decrease quality and create single points of failure in the health care industry.”

– Assistant Attorney General Jonathan Kanter

On May 9, 2024, the Antitrust Division of the Department of Justice (DOJ) announced a new Task Force on Health Care Monopolies and Collusions (HCMC). Comprised of civil and criminal prosecutors, economists, healthcare industry experts, technologists, data scientists, investigators, and policy advisors, the HCMC Task Force’s goal is to “root out monopolies and collusive practices” in the healthcare industry.

The task force will investigate, both civilly and criminally, purported unfair competition in what the Antitrust Division is calling a “a whole-of-division” and “whole of government” approach to healthcare antitrust concerns.  This the latest example of increased scrutiny by the Biden Administration into business practices the Administration believes may violate the antitrust laws and will undoubtedly rely heavily on data analytics as part of its initial investigative efforts.

According to the DOJ, the task force will focus on several key areas.

  1. “Multi-Sided Giants.” The task force will focus on what the DOJ has labeled “multi-sided giants,” i.e., vertically integrated “payviders” who rely on the “platformization” of healthcare to “stack” various components of the healthcare industry together, creating an integrated conglomerate that includes payors, providers, PBMs, claims processors, and banks.
     
  2. Rapid Accumulation of Healthcare Assets. The HCMC task force will also focus on entities that have acquired multiple healthcare assets.  According to the DOJ, these “rapid asset” entities limit competition by functioning as de facto “gatekeepers” in the healthcare industry.  
     
  3. Coordination with Other Government Agencies. The task force is not limited to the Antitrust Division and will work with, and across, other government agencies to bring multiple investigative tools to bear on alleged anti-competitive behavior in the healthcare industry. The Antitrust Division lists healthcare antitrust enforcement as a top priority and signaled it will work across the Department to enforce non-antitrust related misconduct it discovers during its antitrust investigations.

Takeaways

  1. Review Recent M&A Activity. The DOJ has signaled an interest in vertically integrated “payvider” companies that rely on the “platformization” of health care to “stack” various health care industry components together.  Similar to the DOJ’s recent safe harbor for the voluntary self-disclosure of issues learned during the course of M&A transactions, companies should carefully assess due diligence and include compliance professionals to reduce risks in transactions.  
     
  2. Review Books & Records. Reviewing your business’ billing practices and assessing whether they aligned with best practices can help you determine whether your business is at risk of receiving a closer look by the DOJ.  
     
  3. Beware of Data Analytics. The DOJ appears to be particularly interested in taking enforcement action against entities whose business practices have negatively impacted patient care.  Data analytics will play a large role in DOJ’s investigation.  Conducting a review of the care provided to ensure it aligns with best practices and industry standards serves as a strong defense against potential government enforcement.
     
  4. Address Concerns Promptly. The DOJ has offered significant incentives to whistleblowers and companies to disclose potential wrongdoing. Over the last two years, the DOJ has announced numerous policy changes on corporate criminal enforcement, which were largely based on a self-described “carrots and sticks” approach (“a mix of incentives and deterrence”).  However, the timelines for companies to avail themselves of these programs are short. Therefore, consulting counsel once an issue appears, or in anticipation of one, is critical to assess next steps. Whether to conduct an internal investigation, develop or improve effective compliance programs, or assess whether a Voluntary Self-Disclosure is in the company’s best interest are all decisions that must occur quickly.  

Attorneys at Womble Bond Dickinson have the experience to assist you and stand ready to do so.

Womble Bond Dickinson (US) LLP’s White-Collar Defense, Investigations, and Regulatory Enforcement Team navigates domestic and international clients in all manner of white collar, regulatory, corporate and congressional investigations. The White Collar and Antitrust Teams work together to assist clients facing antitrust investigations across a wide range of sectors of the economy. Our team includes a distinguished roster of veteran defense attorneys, former federal prosecutors and U.S. Attorneys who served at the highest levels of the Department of Justice and at leading United States Attorneys’ Offices. Our team also includes Chambers Ranked (Band 1) lawyers and alumni of the White House, the SEC’s Enforcement Division, the U.S. Senate and House of Representatives.