Acting in Light of Antitrust Law

by Legal and Regulatory Affairs Staff

Article reviewed for accuracy July 2018

September 27, 2007 — Antitrust law governs competition in the marketplace. Economic competitors, whether giant oil companies or individual psychologists, cannot get together and agree on the prices they will charge (price fixing) or band together and boycott a purchaser in order to affect prices (boycott).

Consider the following information related to antitrust law when planning to take action on rate cuts by managed care companies:

Acting on your own. Antitrust concerns generally do not apply to individual psychologists or practice groups such as partnerships dealing on their own with managed care companies about fee issues. For example, individual psychologists are always free to decide what company rates they will or will not accept, or to set their own rates (though a company may not pay those rates, even if the psychologist is out-of-network). Individual psychologists are also free to cease their participation in the company’s network if they object to a rate cut, and to advise the company of their intention to do so.

Acting with other psychologists. Antitrust issues arise once you communicate with or take concerted action with other psychologists who are your competitors in the marketplace. You must exercise great caution to avoid the risk of violating antitrust law.

Steer clear of the following situations:

Price fixing. Avoid any communications or agreements with competing psychologists that would suggest a joint agreement — for example, a price fixing arrangement where everyone agrees on the minimum rate they should accept from the company or what payment amount constitutes an appropriate rate. Mere discussions about acceptable fees from a managed care company or about the fees you set for your services can create antitrust risk, even if you have no intention of actually agreeing to fix prices.

Boycotts. Avoid any explicit or implicit threats that a group of competing psychologists will boycott the company in an attempt to influence rates. While antitrust law does not define “implicit threat,” you should steer clear of suggesting that you are calling for other psychologists to join you in leaving the network.