The U.S. Justice Department is investigating Anthem's use of so-called "most-favored nation" clauses -- essentially a demand for the lowest price a provider charges -- in the Indianapolis market. Deborah New, a spokeswoman for Anthem, said the insurer's request for what it calls a "lowest comparable rate" clause is common. "We negotiate for the lowest possible prices and request assurances from providers that they're not giving a lower price for services to companies bringing in a comparable volume of business," New said. At deadline, Justice Department officials could not be reached for comment. Both the Justice Department and the Federal Trade Commission have investigated the use of most-favored nation clauses in various markets, but there have been few enforcement actions, according to David Marx Jr., an attorney with McDermott Will & Emery in Chicago. Depending on their structure, such clauses can be viewed as anticompetitive because they make it more difficult for smaller companies to compete and for new competitors to enter the market, Marx said.
New said Anthem has complied with the Justice Department's request for information, which it received last fall. She said she did not know if the company makes use of lowest comparable rate clauses outside of Indiana. Two Indianapolis-area providers -- St. Vincent Hospitals and Health Services and St. Francis Hospitals and Health Center -- confirmed that they received civil investigative demands seeking information on Anthem contracts and complied. The Indianapolis Star disclosed the existence of the investigation in a May 14 article. Indianapolis-based Anthem, the largest health plan in Indiana and one of the largest in the nation, is about to get even bigger: Its $16 billion merger with WellPoint Health Networks is expected to close within a few months. -- by Mark Taylor