Unions and physicians are the oil and water of the healthcare industry. Neither pair mixes well no matter how many times its tried. Its time to attempt a different recipe.
The latest blow to the physician union movement was a June antitrust settlement between the U.S. Justice Department and the Federation of Physicians and Dentists, a union based in Tallahassee, Fla. As detailed in this issues feature, the government accused the union of illegally negotiating fees with health insurers on behalf of about 120 OB/GYNs in the Cincinnati area. According to the Justice Department, the physicians were competitors, and under federal antitrust laws, competitors cant conspire to set prices for their services. Although the union admitted to no wrongdoing under the settlement, it agreed not to negotiate payer contracts for services provided by any of the unions private-practice members anywhere in the country. Ouch.
Unions can collectively bargain for their members, but they can do so only when those members are true employees. Employed physicians, for example, are eligible for union representation. They are a single economic unit that cant conspire with itself, not a group of actual competitors.
Competing physicians have been trying to hide behind the union labeland sidestep federal antitrust lawsfor years to get the upper hand on insurers. In one of the first cases of its kind, the Colorado attorney generals office busted a group of about 200 physicians that went by the name of the Colorado Union of Physicians and Surgeons. The state said the union was a sham and that the physicians were independent competing doctors, not employees. In 1990, the physicians settled with the state by agreeing not to engage in any more collective bargaining with payers on behalf of its members. At the time, antitrust experts said the Colorado case sent a stern warning to independent physicians not to try that again. But here we are, nearly two decades later, and were basically reporting the same story.
If independent physicians want more money for their services, they have to justify it by providing better care and service than their peers. Its called competition.