A group of managed-care organizations can sue NorthShore University HealthSystem over allegations that they were charged anticompetitive prices for healthcare after the 2000 merger that created the system.
An Illinois federal judge largely preserved a class-action lawsuit against NorthShore stemming from the merger of Evanston (Ill.) Northwestern Healthcare and Highland Park (Ill.) Hospital. Although the Chicago-area hospital group claimed the organizations’ allegations were made outside of the time limit, U.S. District Judge Edmond Chang said the case can go forward under a 2004 Federal Trade Commission antitrust challenge of the deal. Typically, companies or individuals can only file private lawsuits under federal antitrust law for four years after the allegedly anticompetitive event. But the clock stops ticking while the government has a pending suit.
“This means that whatever rights the class had as of February 10, 2000—four years before the FTC instituted its action against NorthShore—still existed when the class filed its complaint on Aug. 7, 2007,” Chang wrote.
Although the managed-care organizations attempted to sue for damages from before this period, Chang said there was no evidence to support their claims that they were charged supra-competitive prices earlier, as there were no renegotiated managed-care organization contracts in effect at that time. Ultimately, the FTC determined in 2007 that the three-hospital merger was anticompetitive, but it allowed the hospitals to stay together, even though an administrative law judge tried to unwind the merger in 2005.
NorthShore is currently fighting an FTC lawsuit against the system’s pending merger with Advocate Health Care.
