Ohio health system sued by DOJ over alleged antitrust violations related to payer contracts
The U.S. Department of Justice (DOJ) has filed a lawsuit against a large nonprofit health system in Ohio, alleging it abused “its market power to impose contractual restrictions that impede or completely prevent” insurers from deploying cost-saving measures, thus raising the price of healthcare services for everyone in the state.
According to an announcement, the DOJ’s Antitrust Division and the Attorney General of Ohio (AG) are co-plaintiffs in the civil lawsuit against OhioHealth, which operates 16 hospitals and over 200 sites throughout 47 counties in the state. The complaint is centered around the in-network status of the healthcare group’s hospitals, clinics and providers—something authorities allege is forced on insurers running commercial plans, even when competitors in various counties offer services at a more affordable rate.
This, the DOJ and Ohio AG allege, has prevented “the development of budget-conscious plans in the Columbus area,” raising the cost of insurance premiums for patients and employers and leaving them with fewer options for coverage.
Plaintiffs added that OhioHealth’s prices are often significantly higher than what other hospitals and clinics charge, with court documents focusing on the Columbus area. The control it wields over the market is allegedly akin to price fixing, in violation of state and federal market regulations that forbid anticompetitive practices and collusion.
“Competition for healthcare is vital to all Americans,” Acting Assistant Attorney General Omeed A. Assefi of the Justice Department’s Antitrust Division, said in a statement. “This lawsuit challenges anticompetitive contract restrictions that prevent consumers from choosing lower-cost health plans and severely limit consumers’ access to price information. These restrictions cause many Columbus residents to pay more for lower-quality healthcare. American families and consumers deserve better.”
Largest health system in the capital region
In the lawsuit, it is alleged that OhioHealth is in a position of market dominance in the Columbus metro area, controlling over 35% of all hospital beds in and around the city, more than any single competitor.
It’s its position as the market leader that allows OhioHealth to effectively eliminate payer contracts that would benefit other health systems, such as Ohio State University Wexner Medical Center and Mount Carmel Health System, who often have cheaper prices.
The DOJ and the Ohio AG are seeking an injunction, asking a federal court to intervene and force the health system to change its business practices and comply with federal law—if a court finds OhioHealth is civilly liable for the claims made in the lawsuit.
“When competition is blocked, consumers end up being the biggest losers,” Ohio Attorney General Dave Yost said in another statement. “My office stands with the Justice Department in our determination to eliminate these types of unfair practices and protect Ohioans' wallets.”
HealthExec reached out to OhioHealth for comment and received the following statement:
"OhioHealth has been cooperating with the DOJ throughout its review of our managed care agreements. We are confident in our position and remain committed to full compliance with all applicable laws and regulatory requirements. As this is active litigation, we will not comment on specifics beyond what has been publicly disclosed."
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.