Executive office update: Anatomy of a DOJ lawsuit: The backstory on physician involvement

Thursday, September 01, 2016 12:07 PM
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by Alfred Gilchrist, CEO Colorado Medical Society

The cover story on the significance of the Department of Justice’s (DOJ) lawsuit to block the health insurance mega-mergers gives you some idea of the coordinated efforts by the AMA and state medical associations to make your voice heard. However, this level of engagement required a careful logistical assessment, as there is no shortage of exam-room relevant, politically viable issues where our limited resources can be spent on your behalf.

Our advocacy team worked with the AMA and several other key states to determine the logistical aspects of the engagement process in the earliest days of the merger announcements. A look back at where we started will give you insight into these early assessments and strategic thinking.

In order to frame our response, we collectively made the following assumptions regarding how the companies would approach the mergers. These assumptions proved reasonably accurate. We assumed they would do the following:

  1. Arm themselves with lobbyists, lawyers and public relations firms across the country.
  2. Deploy a message that resonates with the current narrative of the Triple Aim.
  3. Use current state merger laws to limit transparency and public input.
  4. Rely on their carefully developed, long-term relationships with state insurance commissioners and their top executives.
  5. Donate generously to elected officials, parties and others where beneficial to promote their cause.
  6. Try to get early wins by targeting states with the highest probability of success in order to demonstrate momentum to Wall Street and to make the case to regulators that the mergers are the right thing for health care in America.
  7. Launch every legal strategy and argument conceivable, backed by an army of litigators, to make these mergers a reality.

Given the massive resources aligned on the other side, we also made assumptions about our counter strategy.

  1. Rank-and-file physicians vigorously oppose the mergers and mounting a sustained opposition would serve as a unifying cause.
  2. Notwithstanding their street credibility at the state level, physicians would be the underdogs.
  3. A multi-state medical association effort would be needed and to be successful had to be coordinated with the full backing and expertise of the AMA to force the companies to fight across all the states individually.
  4. It would be more appealing and credible to influencers if we played to our strengths at the grassroots level, rather than trying to match the companies’ money and canned PR and legal feints. We would force the companies to counter across 17 states, rather than go head to head with the AMA.
  5. Our advocacy would focus on the corrosive effects of monopsony power. A multi-state effort would have to arm every state medical society with grassroots tools, starting with extensive physician polling and consistent messaging so they could work with the most directly affected practice categories and markets to prove that insurer concentration will harm patients, physicians and employers.

By November 2015, our strategy was fully engaged. Now with the full force of the DOJ and 18 state attorneys general stepping up, the fight continues in federal court and in the court of public opinion. While the insurance companies are going to continue their fight for consolidation in court, questions remain: Will they be turned back, approved and required to divest in more markets, or is there some other business response we haven’t yet considered?

While the suits progress, the lessons learned from this engagement should provoke state legislative and regulatory debate and, hopefully in Colorado, constructive dialogue with at least some of the insurance companies. Once the mergers are blocked, the production of a higher degree of equity, fairness and accountability between the business interests of the companies and the clinical interests of medical practices and systems would be a welcome endgame.

Posted in: Colorado Medicine | Practice Evolution | Payment Reform | Interacting With Payers | Initiatives | AMA


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