ANTITRUST: ANTITRUST LAW & POLICY eJOURNAL

"Brief of Amici Curiae Texas Professors Specializing in Health Law and Health Policy, Teladoc Inc. v. Texas Medical Board (5th Cir.)" Free Download

WILLIAM M. SAGE, University of Texas at Austin School of Law, University of Texas at Austin - Dell Medical School
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When a majority of a professional licensing board is comprised of active members of the licensed profession, the Supreme Court has instructed lower courts to require active supervision by the state itself before conferring immunity from suit challenging board action under the federal antitrust laws. North Carolina State Bd. of Dental Exam’rs v. FTC, 135 S. Ct. 1101 (2015) (“North Carolina Dental?). The purpose of supervision is to ensure that the board’s actions reflect a sovereign state’s policy decision to reduce or displace competition, for which the state is politically accountable. Here, there was no such supervision or political accountability for the restriction the Texas Medical Board (“Board?) imposed on telehealth providers, and the district court properly denied the Board’s state-action defense.

The outcome of this litigation has national importance beyond telehealth because minimally scrutinized, unsupervised physician self-governance – often by state medical boards – exerts significant drag on the U.S. health care system. The affordability of health care for individuals and society, and therefore the efficiency with which it is produced and delivered, are critical health policy goals. Recent assessments from the Institute of Medicine of the National Academies (“IOM?) conclude that the U.S. health care system wastes nearly $1 trillion each year on unnecessary, disorganized, overpriced, badly measured, and sometimes harmful services. One cannot escape the conclusion that the consumer orientation, cost discipline, interoperability, and continuous innovation that are routine in other industries, and that make market competition the desired default position for the private economy, are severely underdeveloped in health care.

Although state licensing boards often justify their actions as “patient protection,? it also is indisputable that professional self-regulation is a much less effective guarantor of quality and safety than the medical profession asserts and believes. In two authoritative reports from the early 2000s, the IOM documented systematic failures to deliver care that is safe, effective, patient-centered, timely, efficient, and equitable, resulting among other things in nearly 100,000 avoidable patient deaths every year.

The public and its elected representatives do not prefer their health care system to spend excessively and perform poorly. Rather, the U.S. health care system is trapped in a web of professional privilege that prevents it from achieving its goals. Unsupervised self-regulation is a significant, often invisible obstacle to building a health care system that meets the public’s needs and therefore promotes the state’s interests. Physicians aggressively defend their individual and collective authority to serve patients on terms that they themselves establish, even if the result is to increase cost and decrease access to care. The medical profession has enforced its private perception of the public interest for many decades, typically in good faith but limited by preconception, habit, and tunnel vision.

Antitrust law plays an important role in advancing consensus health policy goals regarding affordability, quality, choice, and consumer responsiveness. Moreover, the fact that self-regulation of medical practice by state licensing boards and other professional bodies has been so pervasive argues for more, not less, state oversight of potentially anticompetitive conduct. Without active supervision, many policy choices made by the Board remain unidentified or only vaguely described, rendering it impossible for politically accountable state actors such as the governor or legislature to register their opposition. Only a full-throated supervision requirement, as called for by the Supreme Court, can reveal professionally determined constraints on markets as explicit policy options and subject them to meaningful political oversight.

The harm to competition is obvious when a group of competitors meets specifically to fix prices while asserting immunity from antitrust liability. Although a licensing board’s unsupervised exclusion of a rival category of providers or its blanket prohibition on a modality of care has effects comparable to a collective refusal to deal, anticompetitive medical self-regulation is often more challenging to disentangle from explicit state law. Yet the cumulative effect of embedding unsupervised private processes – especially those that impede market entry – within a seemingly comprehensive but inadequately specified regulatory framework is to worsen inertia in public policy-making and perpetuate conditions that are both anticompetitive and increasingly inconsistent with democratic preferences.

The sky will not fall if the Texas Medical Board is subjected to active supervision requirements. Substantive antitrust law is well-equipped to distinguish between reasonable and unreasonable restraints on trade, and any socially desirable activities of licensing boards that otherwise might be construed as violations of the Sherman Act can be enacted in legislation or administrative regulation and supervised by bona fide state actors. Some Board limitations on medical practice even may be procompetitive, facilitating informed consumer choice and ensuring that effective services are delivered as promised.

Moreover, the composition of health professional licensing boards can be sufficiently diversified to reduce the likelihood that physicians or any other single group of licensees can, through either conscious or unconscious bias, subvert bona fide state regulation of medicine and health to serve their own interests. Such a restructuring of licensing board practices not only would avoid the need for active supervision under the North Carolina Dental standard, but also would likely result in a more nimble, consumer-oriented, and innovative approach to professional self-regulation.

Therefore, the Board’s state action defense should be denied.

"The Business of Amateurs: Suffering Student-Athletes and a Thriving NCAA" Free Download

MICHAEL A. CARRIER, Rutgers Law School
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The NCAA frequently lauds amateurism and the ideal of the "student athlete." But in contrast to this idyllic conception, college football is big business. And it is built on the backs of gladiators, football (and basketball) players who are often forgotten, disposable cogs in big-time college sports.

Such is the story Bob DeMars masterfully weaves in "The Business of Amateurs." This short essay reviews DeMars's documentary. It contrasts the excesses of college football's gold-plated facilities with players' poverty and health issues, particularly in former athletes suffering from dementia and depression.

In the past few years, stories about student-athletes as impoverished cogs in the NCAA's billion-dollar big business machine have spread. DeMars adds to these stories. And he offers a particularly sobering perspective by focusing on the former players whose lives have been upended — if not ended — by injuries.

"The Impact of Economic Efficiency on Employment: A Case Study of Mergers & Acquisitions" Free Download
82nd International Atlantic Economic Society Conference Washington D.C. 2016

ANCA D. CHIRITA, Durham University, Durham Law School
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This paper seeks to challenge the present rhetoric used by competition policy makers and enforcers when advancing economic efficiency as a goal of competition policy. The fixation on the promotion of economic efficiency and intense or fierce competition comes at the expense of other sensible social values, such as job creation. This trend of modern competition policy is based on a reductionist assumption about how markets work in practice.

A dogmatic application of competition policy serving economic calculus, rather than the social order, has silently ignored the negative impact of competition on wages and employment. Over the past many years of successful enforcement of competition laws, no attempts have been made to reverse the negative social impact that has been inflicted by fierce and aggressive forms of competition.

By revisiting the classical price and wage efficiency theoretic assumptions, this paper challenges the use of the ‘efficiency’ benchmark at both micro- (industrial organization) and macroeconomic levels. The case study of mergers and acquisitions (M&A) across several sectors of the economy will be used to demonstrate how internal growth and merger-specific efficiencies – some of which include the elimination of labour costs – affect wage efficiency and employment prospects. While 6.5% out of 3.7 million jobs losses as a result of M&A activity during a four-year period does not seem to have created a major macroeconomic imbalance, a closer look at recent M&A trends during 2013-2016 demonstrates that, indeed, job losses far outweigh the balance of job creation, i.e. one newly created job for every 40 job cuts.

This paper challenges the well-established assumption that ‘new jobs replace old jobs’ following a successful merger. This false assumption is basically at odds with the fact that the majority of European Union mergers are approved, even if subject to conditions, leaving an insignificant percentage of mergers blocked since 1990 (24 or 0.3%).

"Commoditized Speech, 'Bargain Fairness,' and the First Amendment" Free Download
Brigham Young University Law Review, Forthcoming

ANDREW TUTT, Independent
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This Article develops a theory of the appropriate role of the First Amendment in governing the regulation of commoditized speech (that is, speech people buy and sell). Courts should apply a “bargain fairness? model when reviewing such regulations: Speech regulations that merely enhance the bargaining power of one of the parties to a transaction — by ameliorating inequalities in setting the terms of the bargain — should be upheld, while regulations that have other purposes and effects should be struck down.

This Article shows that this simple theory tracks the Supreme Court’s precedents remarkably well. It is also judicially manageable, places minimal burdens on valuable First Amendment speech, and effectively tracks widespread intuitions about the appropriate boundaries between permissible and impermissible censorship.

"Exploring If US & EU Antitrust Law Differences Are Substantive or Superficial by Re-Trying US Cases in the EU" Free Download

NICHOLAS PASSARO, Cornell University, Law School, Students
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This article canvases several types of antitrust violations. It discusses the legal standards in both the U.S. and EU, explains an illustrative case from each jurisdiction, discusses the differences in the law by comparing and contrasting the cases, and then retries the U.S. case under EU law to see how those differences shape the outcome, if at all.

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About this eJournal

This eJournal distributes working and accepted paper abstracts dealing with all aspects of antitrust and competition policy, including mergers, cartels, monopolies, and price discrimination.

Editor: John Shepard Wiley, Independent

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Directors

ANTITRUST & REGULATED INDUSTRIES EJOURNALS

BERNARD S. BLACK
Northwestern University - Pritzker School of Law, Northwestern University - Kellogg School of Management, European Corporate Governance Institute (ECGI)
Email: bblack@northwestern.edu

RONALD J. GILSON
Stanford Law School, Columbia Law School, European Corporate Governance Institute (ECGI)
Email: rgilson@leland.stanford.edu

Please contact us at the above addresses with your comments, questions or suggestions for LSN-Sub.

Advisory Board

Antitrust: Antitrust Law & Policy eJournal

JAMES R. ATWOOD
Covington & Burling

JONATHAN B. BAKER
Professor of Law, American University - Washington College of Law

MAXWELL M. BLECHER
Attorney at Law, Blecher and Collins

DENNIS W. CARLTON
Professor, University of Chicago - Booth School of Business, National Bureau of Economic Research (NBER)

FRANK H. EASTERBROOK
Senior Lecturer, University of Chicago Law School

NICHOLAS ECONOMIDES
Executive Director, Networks, Electronic Commerce, and Telecommunications Institute, Professor of Economics, New York University - Leonard N. Stern School of Business - Department of Economics

EINER R. ELHAUGE
Professor of Law, Harvard Law School

ELEANOR M. FOX
Professor of Law, New York University School of Law

HERBERT J. HOVENKAMP
Professor, University of Iowa - College of Law

LOUIS KAPLOW
Professor of Law, Harvard Law School, National Bureau of Economic Research (NBER)

DANIEL L. RUBINFELD
Professor, University of California at Berkeley - School of Law, National Bureau of Economic Research (NBER), NYU Law School

CARL SHAPIRO
University of California, Berkeley - Haas School of Business