Henry Ford Allegiance 'Reluctantly' Settles DOJ Antitrust Suit

John Commins, February 12, 2018

"The proposed settlement will make it easier and more efficient for the department to enforce the decree by allowing the department to prove alleged violations by a preponderance of the evidence," Delrahim said. "These provisions will encourage a stronger commitment to compliance and will ease the strain on the department in investigating and enforcing possible violations."

Patricia Wagner, an antitrust attorney with Epstein Becker Green and a disinterested observer, said DOJ is applying more rigorous benchmarks for its consent decrees.

"When you do your annual report you have to document that everybody got their four hours of training and you have to provide the materials that were used in those training sessions. If DOJ asks, you'd have to provide a lot of who had what conversations, and when," Wagner said. "Instead of just having a general 'you will comply with this consent order and verify annually that you are doing so,' it is giving organizations the steps that DOJ thinks they need to take in order to comply with the consent judgements." 

"If I am a CEO of a hospital maybe I am thinking about how to get ahead of this situation. Should I have someone who is responsible for antitrust compliance?" she said. "All hospitals have large compliance programs that are usually focused, as they should be, on fraud and abuse and licensure issues. It seems like a natural evolution to say 'maybe we should be thinking about including antitrust in that larger compliance program.'"

Henry Ford Allegiance Health operates the only hospital in Jackson County, MI. The system also operates primary care, physical rehabilitation, and diagnostic facilities in several counties in south central Michigan. Allegiance joined Henry Ford Health System in 2016.

Allegiance’s statement in full reads as follows:

Allegiance Health and the Department of Justice have settled an antitrust case brought by the DOJ against Allegiance Health in 2015. The original complaint alleged that Allegiance Health entered into an agreement with Hillsdale Community Health Center to limit marketing in Hillsdale County.

We reluctantly chose to settle this litigation because continuing to defend ourselves against the United States and State of Michigan became too costly. This decision, regrettable but necessary, requires us to discontinue our defense of this case before the Court could rule on any of the highly contested issues raised in the litigation. 

We still deny unlawful conduct of any kind, and the settlement does not include any admission of liability. Despite almost three years of litigation, there was no finding of wrong doing by the Court, and, as recently as December, the Court contemplated dismissing the action in its entirety.  In addition, the Court has never ruled that the citizens of Hillsdale County were harmed by our marketing strategy.

We reaffirm our belief that we promoted competition in south central Michigan and benefitted the citizens of Hillsdale County in undeniable ways. The terms of the settlement allow us to continue our marketing strategies in order to best serve the people of south central Michigan including Hillsdale County.

John Commins

John Commins is a senior editor at HealthLeaders Media.

Facebook icon
LinkedIn icon
Twitter icon