Feds won't challenge GNYHA gain-sharing plan

The Justice Department said it will not challenge the Greater New York Hospital Association's proposed gain-sharing program for its member hospitals.

The GNYHA submitted a business review request to the Justice Department in August for the voluntary program, which will apply to both commercial health insurance and Medicare and Medicaid managed-care products.

The Justice Department said in a Jan. 16 letter (PDF) that it doesn't intend to challenge the program because the hospitals will not exchange confidential and competitive information. In addition, each participating hospital will be individually responsible for setting physician gain-sharing payments.

“Based on GNYHA's representations, the proposed information sharing program is unlikely to facilitate collusion or otherwise raise competitive concerns,” Bill Baer, assistant attorney general for the Justice Department's antitrust division, wrote in the letter.

The program will use a third-party contractor to calculate a “best-practice norm” for certain in-patient treatments or procedures. That data will be used to measure physician performance. A physician who meets hospital-established quality standards while reducing costs could receive a share of the hospital's cost savings

Eleven of the association's roughly 100 member hospitals in New York have registered for the program, according to the letter.

A GNYHA spokesman said the program is not connected to GNYHA Ventures, the association's for-profit business that includes group-purchasing services. Additional information about the program was not immediately available.