The Source Blog

On October 18, 2024, the North Carolina Supreme Court unanimously ruled to send a case challenging the states Certificate of Need (CON) law back to a lower court.  Certificate of Need laws require healthcare providers and facilities to get permission from the state government before adding or expanding healthcare services, equipment, or facilities.  To get this permission, the provider must show that the new service is needed, hence the name. The case in North Carolina originated in April 2020 when Dr. Jay Singleton, an eye surgeon, filed suit against legislative […]

On September 23, 2024, Particle Health, a startup that aggregates and shares data among healthcare providers and health technology companies, filed suit in the U.S. District Court for the Southern District of New York against Epic Systems, the nation’s largest vendor of electronic health records.  The suit alleges that Epic is using its market power to destroy competition and represents a challenge to Epic’s dominance in the patient data marketplace. Parties to the Suit Epic is a software company that provides electronic health record (EHR) resources for hospitals and health […]

On Saturday, Sept 18, 2024, Governor Gavin Newsom vetoed California AB 3129, legislation that would have created a requirement for the Attorney General to review and give approval before private equity groups could buy into certain health care facilities and providers (previously reported on by The Source). In his veto message, the Governor stated that the Office of Health Care Affordability (OHCA), established in 2022, “was created as the responsible state entity to review proposed health care transactions, and it would be more appropriate for the OHCA to oversee these consolidation issues as […]

New laws and rules requiring greater transparency into the behaviors and reimbursements of insurers have given employees and employers a clearer picture of where their healthcare dollars are going.  For example, the “Transparency in Coverage” rule, implemented in October 2020, required health plans and insurers to post rates they negotiate with providers and develop price transparency tools related to cost-sharing.  The “Consolidated Appropriations Act”, passed in 2021, requires Third Party Administrators (TPAs) to provide notice of other compensation they receive to plan sponsors and restricts “gag clauses” that would otherwise […]

No Decision in AAEM-PG v. Envision Case: A Potential Precedent-Setting Corporate Practice of Medicine and Private Equity Case is Avoided  A decision in the long-anticipated case, the American Academy of Emergency Medicine Physician Group (AAEM-PG) v. Envision Healthcare, will not come to pass, as Envision, a private equity-backed emergency physician staffing company, choose to exit the California market.  In a press release, AAEM-PG stated a concern about whether a California court could retain jurisdiction over the case after Envision exited, and noted that a confidential settlement had been made.   Experts, […]

Healthcare Competition and Consolidation Medicare Advantage and Consolidation’s New Frontier — The Danger of UnitedHealthcare for All (New England Journal of Medicine) Hayden Rooke-Ley, Soleil Shah, and Erin C. Fuse Brown This article describes the recent ransomware attack on Change Healthcare and the ownership structure of UnitedHealth Group, including how much market power it has with medical claims, data analytics, insurance, physicians, PBMs, pharmacies and a bank.  The authors note the risks involved in these types of conglomerations, including market abuses that raise costs, erode quality of care, and harm […]

The convoluted journey of the FTC’s attempt to ban noncompete agreements has taken another turn.  On July 23, a Federal District Court Judge reversed a ruling from a lower Federal Court in Texas that had temporarily blocked the FTC from enforcing the rule, pending ongoing litigation.  The most recent ruling states that the FTC has the power to ban anticompetitive practices, including noncompete agreements.  The ruling also states that the plaintiff had not shown that it would suffer irreparable harm from the rule if it were allowed to go into […]

In late June Novant announced it would abandon attempts to buy two Community Health Systems (CHS) hospitals in North Carolina.  This announcement followed a preliminary ruling in Federal District Court for Novant and a subsequent appellate court ruling for the Federal Trade Commission (FTC). Regardless of the final outcome of the merger, the preliminary Novant win is significant because it represents a successful use of the often cited, rarely successful, “failing firm” defense – which parties can potentially use to push through a merger that would otherwise create an unacceptable […]

On Wednesday, July 3, 2024, a Texas Federal Court issued a preliminary injunction against the FTC’s noncompete ban in the case brought by Ryan LLC and the U.S. Chamber of Commerce, preventing the rule from taking effect on September 4.  The decision, made by U.S. District Judge Ada Brown, stated that the plaintiffs were likely to succeed on the merits that the FTC lacks authority to promulgate the rule, which the Judge called “arbitrary and capricious”, and that that blocking the rule temporarily is in the public interest.  Although the […]

On a 6-3 decision following party lines, the conservative majority of the U.S. Supreme Court overturned a long-standing legal precedent that required courts to generally defer to regulations issued by Federal agencies that interpret and enact Congressional statutes, commonly referred to as Chevron deference.  Chevron deference required courts to defer to an agency’s “reasonable interpretations” of ambiguous statutes passed by Congress. The end of the precedent opens the doors to legal challenges of existing Federal administrative law, and will likely weaken the ability of Federal agencies to issue administrative regulations […]