Jeff Miles, a healthcare antitrust attorney with Ober, Kaler, Grimes & Shriver in Washington , tells Modern Healthcare reporter Melanie Evans about the legal, business and policy issues raised by the pending class-action antitrust lawsuits against hospitals accused of conspiring to controland artificially lowernurse wages.
[00:00:01.23] Woman's Voice: Welcome to this edition of Special Report Extra, brought to you by Modern Healthcare, and powered by Martopia. With each edition of Special Report Extra, listeners hear directly from key healthcare executives involved in the major events shaping the industry.
[00:00:31.00] Melanie Evans: Hello, this is Melanie Evans, a reporter for Modern Healthcare. I'm speaking with Jeff Miles, a healthcare antitrust attorney who is principal with Ober, Kaler, Grimes & Shriver in Washington. We're speaking today about a handful of lawsuits settled by hospital executives conspiring to hold down nurse wages amid a national nursing shortage. The topic was featured in the Dec. 17 issue of Modern Healthcare.
Mr. Miles, the lawsuits contend that employers illegally depressed nurse wages. How so?
[00:00:56.21] Jeff Miles: Well, they're two basic allegations. The first is, there's an allegation that the hospitals agreed among themselves on wages, and these wages were below the competitive level. And the second allegation, which is related and different, is that the hospitals agreed to exchange wage information among themselves in various ways, and the effect of this was to stabilize nurse wages, again at below competitive levels.
[00:01:28.00] Melanie Evans: What will the plaintiffs need to show in order to win their case?
[00:01:30.24] Jeff Miles: With respect to the first claim, that is the wage-fixing claim, they've got to show an agreement on wages among the hospitals and with respect to the second claim, the agreement to exchange wage information, they've got to show that that agreement to exchange wage information facilitated interdependent conduct among the hospitals, which had the effect of keeping wages low even though there was no agreement among the hospitals on wages.
[00:02:01.13] Melanie Evans: What's at stake for the hospital industry should the court find in favor of the nurses?
[00:02:07.20] Jeff Miles: No. 1: these are going to be very expensive cases to defend; I would expect the cases to go at least two to three years. No. 2: there's a lot of money involved as far as the alleged damages are concerned, because each of the cases is a class action on behalf of all nurses who are allegedly affected by the wage decrease. I think also there's a public policy issue involved here in the sense that everyone recognizes there is a shortage of nurses nationwide, and one of the claims of the plaintiffs isat least one of the reasons for this shortageis this suppression of nurse wages. And it may be that in the course of discovery, as the case goes along, there may be evidence that comes out that explains or at least provides some insight as to why we have this nursing shortage. And I think, finally, the case points out the dangers when competitors exchange prices or exchange wages. Wage exchange programs are quite common in the hospital industry; you see them across the country. They can be lawful, or they can be unlawful, and I think this case may provide a good deal of insight as to the circumstances under which programs like this raise significant antitrust problems.
[00:03:33.01] Melanie Evans: Thank you. This is Melanie Evans, a reporter with Modern Healthcare. We've been speaking with Jeff Miles, a healthcare antitrust attorney, and principal with Ober, Kaler, Grimes, & Shriver in Washington. Thank you for your time, Mr. Miles.
[00:03:45.25] Jeff Miles: Thank you.
[00:03:47.00] Woman's Voice: Thank you for listening to this edition of Special Report Extra, brought to you by Modern Healthcare and powered by Martopia. Listen to other editions of Special Report Extra by visiting the Multimedia section of Modern Healthcare Online at modernhealthcare.com
Running Time: 3 minutes