Staff of FTC Have Advised Southern Arizona Therapy Network, Inc. that Plan To Establish a Network Does Not Appear To Violate the Antitrust Laws

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Staff of the Federal Trade Commission have advised the Southern Arizona Therapy Network, Inc. (SATNET) that the plan to establish a network to provide physical, occupational, and speech therapy services in Pima County, Arizona does not appear to violate the antitrust laws. SATNET proposes to establish mechanisms to discuss among members, and with third-party payers that might be interested in contracting with SATNET members, non-fee related issues such as: referring and scheduling of patients, standards of practice, provider credentialing, patient tracking, and peer-review.

SATNET is a non-profit corporation, and its 18 individual and entity providers include 13 percent of the estimated 300 physical therapists; 6 percent of the estimated 187 occupational therapists, and 1 percent of the estimated 345 speech therapists practicing in Pima County, Arizona. In addition, SATNET would employ an agent to conduct a survey of historical prices charged by SATNET providers for therapy services and share this information with payers and members. SATNET would invite offers of proposed contracts from payers to individual SATNET members, who would individually decide whether to accept a particular proposal. SATNET may also decide to negotiate, with payers, contracts providing for the payment of a predetermined capitation rate to the group as a whole. For the limited purpose of providing capitated services, SATNET members would discuss capitation rates and structures and related issues. Except insofar as necessary to provide capitated services, SATNET members would not discuss fee-related issues or engage in collective negotiations with payers.

In response to the letter from attorneys for SATNET requesting the FTC staff advisory opinion, and signed by David R. Pender, Acting Assistant Director for Healthcare at the FTC, the staff noted that the proposed collection, dissemination, and discussion of information do not appear to endanger competition. The letter also noted that SATNET's plan to act as a messenger between its members and payers in order to facilitate the contracting process does not appear to raise antitrust concern.

NOTE: This letter sets out the views of the staff of the FTC's Bureau of Competition, as authorized by the Commission's Rules of Practice. It has not been reviewed or approved by the Commission. As the Commission's rules explain, the staff's advice is rendered "without prejudice to the right of the commission later to rescind the advice and, where appropriate, to commence an enforcement proceeding." Staff advice concerning issues covered by the FTC/DOJ Health Care Policy Statements will be given within 90 or 120 days (depending on the topic) after all necessary information is provided.

Copies of the letter are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261.

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