Federal Register / Vol. 63, No. 121 /Wednesday, June 24, 1998 / Notices 34423

TRANSACTION GRANTED EARLY TERMINATION—Continued

ET date Trans No. ET req status Party name

G George W. Andrews and Mary Ann Andrews.

G KECO Industries, Inc.

FOR FURTHER INFORMATION CONTACT:

Sandra M. Peay or Parcellena P.

Fielding, Contact Representatives,

Federal Trade Commission, Premerger

Notification Office, Bureau of

Competition, Room 303, Washington,

D.C. 20580, (202) 326–3100.

By Direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 98–16877 Filed 6–23–98; 8:45 am]

BILLING CODE 6750–01–M

FEDERAL TRADE COMMISSION

[File No. 941–0095]

M.D. Physicians of Southwest

Louisiana, Inc.; Analysis To Aid Public

Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

SUMMARY: The consent agreement in this

matter settles alleged violations of

federal law prohibiting unfair or

deceptive acts or practices or unfair

methods of competition. The attached

Analysis to Aid Public Comment

describes both the allegations in the

draft complaint that accompanies the

consent agreement and the terms of the

consent order—embodied in the consent

agreement—that would settle these

allegations.

DATES: Comments must be received on

or before August 24, 1998.

ADDRESSES: Comment should be

directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., N.W.,

Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

William Baer, FTC/H–374., Washington,

D.C. 20580. (202) 326–2932.

SUPPLEMENTARY INFORMATION: Pursuant

to Section 6(f) of the Federal Trade

Commission Act, 38 Stat. 721, 15 U.S.C.

46 and Section 2.34 of the commission’s

Rules of Practice (16 CFR 2.34), notice

is hereby given that the above-captioned

consent agreement containing a consent

order to cease and desist, having been

filed with and accepted, subject to final

approval, by the Commission, has been

placed on the public record for a period

of sixty (60) days. The following

Analysis to Aid Public Comment

describes the terms of the consent

agreement, and the allegations in the

complaint. An electronic copy of the

full text of the consent agreement

package can be obtained from the FTC

Home Page (for June 19, 1998), on the

World Wide Web, at ‘‘http://

www.ftc.gov/os/actions97.htm.’’ A

paper copy can be obtained from the

FTC Public Reference Room, Room H–

130, Sixth Street and Pennsylvania

Avenue, N.W., Washington, D.C. 20580,

either in person or calling (202) 326–

3627. Public comment is invited. Such

comments or views will be considered

by the Commission and will be available

for inspection and copying at its

principal office in accordance with

Section 4.9(b)(6)(ii) of the Commission’s

Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order to

Aid Public Comment

The Federal Trade Commission has

accepted, subject to final approval, an

agreement to a proposed consent order

from M.D. Physicians of Southwest

Louisiana (‘‘MDP’’). The agreement

settles charges by the Federal Trade

Commission (‘‘Commission’’) that MDP

has violated Section 5 of the Federal

Trade Commission Act by: (1) Fixing the

prices and other terms on which its

members would deal with third-party

payers; (2) collectively refusing to deal

with third-party payers; and (3)

conspiring to obstruct the entry of

managed care into Calcasieu Parish,

Louisiana.

The proposed consent order has been

placed on the public record for sixty

(60) days for reception of comments by

interested persons. Comments received

during this period will become part of

the public record. After sixty (60) days,

the Commission will review the

agreement and the comments received,

and will decide whether it should

withdraw from the agreement or make

final the agreement’s proposed order.

The purpose of this analysis is to

facilitate public comment on the

proposed order. The analysis is not

intended to constitute an official

interpretation of the agreement and

proposed order or to modify in any way

their terms. Further, the proposed

consent order has been entered into for

settlement purposes only and does not

constitute an admission by MDP that the

law has been violated as alleged in the

complaint.

The Complaint

Under the terms of the agreement, a

proposed complaint would be issued by

the Commission along with the

proposed consent order. The allegations

in the Commission’s complaint are

summarized below.

MDP is a physician organization

based in Lake Charles, Louisiana. All of

the members of MDP are physicians

practicing in and around Calcasieu

Parish, Louisiana, the parish in which

Lake Charles is located. During the time

period addressed by the allegations of

the complaint, MDP members

constituted a majority of all physicians

practicing in Calcasieu Parish,

Louisiana. In certain physician

specialties, MDP members constituted

all or most of the physician specialists

practicing in Calcasieu Parish.

MDP was formed in 1987 as a vehicle

for its members to deal concertedly with

the impending entry into Calcasieu

Parish of managed care. Beginning in

1987, and continuing until at least 1994,

when MDP first learned that it was

under investigation by the staff of the

Commission, MDP conspired to fix the

prices and other terms under which its

members dealt with third-party payers.

MDP also conspired to prevent or delay

the entry into Calcasieu Parish of

managed care.

Until 1994, MDP members refused to

participate, either individually or

collectively, in health care plans offered

by Blue Cross and Blue Shield of

Louisiana, the Louisiana State

Employees Group Benefits Program,

Aetna Insurance Company, Healthcare

Advantage, Inc., and other third-party

payers attempting to do business in

Calcasieu Parish.

The members of MDP agreed that

MDP would represent them in

negotiations with third-party payers.

MDP functioned as the exclusive

representative of its members. Until

1994, the members of MDP dealt with

third-party payers only though MDP.

MDP’s members have not integrated

their medical practices in any

economically significant way, nor have

they created any efficiencies that might

justify this conduct.

MDP’s actions have harmed

consumers in Calcasieu Parish by,

among other things, restraining

competition among physicians,
34424 Federal Register / Vol. 63, No. 121 /Wednesday, June 24, 1998 / Notices

1Statements of Antitrust Enforcement Policy in

Health Care, issued August 28, 1996, 4 Trade Reg.

Rep. (CCH) ¶ 13,153.

depriving consumers of the benefits of

competition among physicians,

increasing the prices that consumers

pay for physician services and medical

insurance coverage, and depriving

consumers of the benefits of managed

care.

The Proposed Consent Order

The proposed consent order is

designed to prevent the illegal concerted

action alleged in the complaint, while

allowing MDP to engage in legitimate

joint conduct. Section II of the proposed

order contains the core operative

provisions. It prohibits MDP from: (1)

Engaging in collective negotiations on

behalf of its members; (2) orchestrating

concerted refusals to deal; (3) fixing

prices, or any other terms, on which its

members deal; and (4) encouraging or

pressuring others to engage in any

activities prohibited by the order.

Section II includes a proviso allowing

MDP to engage in conduct (including

collectively determining reimbursement

and other terms of contracts with

payers) that is reasonably necessary to

operate (a) any ‘‘qualified risk-sharing

joint arrangement,’’ or (b) provided MDP

complies with the order’s prior

notification requirements, any

‘‘qualified clinically integrated joint

arrangement.’’ The proviso addresses

the arrangements that MDP may enter

into, rather than the overall nature of

the group, because a physician group

may enter into legitimate arrangements

with some third-party payers but engage

in illegal conduct with respect to others.

For the purposes of the order, a

‘‘qualified risk-sharing joint

arrangement’’ must satisfy two

conditions. First, it must be one in

which participating physicians share

substantial financial risk. The order lists

ways in which physicians might share

financial risk. These track the four types

of financial risk sharing set forth in the

Statements of Antitrust Enforcement

Policy in Health Care, issued jointly by

the FTC and the Department of Justice.1

Second, to be a ‘‘qualified’’ risk

sharing arrangement, the arrangement

must also be non-exclusive, both in

name and in fact. An arrangement that

either restricts the ability of

participating physicians to contract

outside the arrangement (individually or

through other networks) with thirdparty payers, or facilitates refusals to

deal outside the arrangement by

participating physicians, does not fall

within the proviso. Although exclusive

physician joint arrangements are not

necessarily anticompetitive, they can

impair competition, particularly when

they include a large portion of the

physicians in a market. In light of

MDP’s large share of the physician

market, this definition does not permit

MDP to form exclusive arrangements.

A ‘‘qualified clinically integrated joint

arrangement’’ includes arrangements in

which the physicians undertake

cooperative activities to achieve

efficiencies in the delivery of clinical

services, without necessarily sharing

substantial financial risk. For purposes

of the order, such arrangements are ones

in which the participating physicians

have a high degree of interdependence

and cooperation through their use of

programs to evaluate and modify their

clinical practice patterns, in order to

control costs and assure the quality of

physician services provided through the

arrangement. As with risk-sharing

arrangements, the definition of

clinically integrated arrangement

reflects the analysis contained in the

1996 FTC/DOJ Statements of Antitrust

Enforcement Policy in Health Care. In

addition, as with risk-sharing

arrangements, the arrangement must be

non-exclusive in light of MDP’s large

share of the market. In drafting the

definition of clinically integrated

arrangements, the Agencies sought to be

flexible due to the wide range of

providers who may participate, types of

clinical integration possible, and

efficiencies available. Consequently, the

definition of a clinically integrated

arrangements is by necessity less precise

than that of a risk sharing arrangement.

In order for a qualified clinically

integrated joint arrangement to fall

within the proviso, MDP must comply

with the order’s requirements for prior

notification. The prior notification

mechanism will allow the Commission

to evaluate a specific proposed

arrangement and assess its likely

competitive impact, in order to help

guard against the recurrence of acts and

practices that have restrained

competition and consumer choice.

Section III requires that MDP notify

its members and certain third-parties

about the order. In addition, MDP must,

for the next five years, distribute copies

of the complaint and order to new

members and annually publish the

complaint and order in any annual

report or newsletter sent to MDP

members.

Sections IV, V, and VI consist of

various reporting procedures, consistent

with those found in other Commission

consent orders, that are designed to

assist the Commission in monitoring

compliance with the order.

Finally, section VII terminates the

order twenty years after the date it is

issued, in accordance with Commission

policy.

By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 98–16821 Filed 6–23–98; 8:45 am]

BILLING CODE 6750–01–M

GENERAL SERVICES

ADMINISTRATION

[OMB Control No. 3090–0197]

Submission for OMB Review;

Comment Request Entitled Service

Contracting

AGENCY: Office of Acquisition Policy,

GSA.

ACTION: Notice of request for public

comments regarding reinstatement to a

previously approved OMB clearance

(3090–0197).

SUMMARY: Under the provisions of the

Paperwork Reduction Act of 1995 (44

U.S.C. Chapter 35), the Office of

Acquisition Policy has submitted to the

Office of Management and Budget

(OMB) a request to review and approve

a reinstatement of a previously

approved information collection

requirement concerning Service

Contracting. A request for public

comments was published at 63 FR

19920, April 22, 1998. No comments

were received.

DATES: Comment Due Date: July 24,

1998.

FOR FURTHER INFORMATION CONTACT:

Al Matera, Office of GSA Acquisition

Policy (202) 501–1224.

ADDRESSES: Comments regarding this

burden estimate or any other aspect of

this collection of information, including

suggestions for reducing this burden,

should be submitted to: Edward

Springer, GSA Desk Officer, Room 3235,

NEOB, Washington, DC 20503, and to

Marjorie Ashby, General Services

Administration (MVP), 1800 F Street

NW., Washington, DC 20405.

SUPPLEMENTARY INFORMATION:

A. Purpose

The GSA is requesting the Office of

Management and Budget (OMB) to

reinstate information collection 3090–

0197, Service Contracting. This

information collection is necessary to

determine whether a prospective

contractor is responsible by obtaining

information regarding financial and

other capabilities of the prospective

contractor.