The dangers of a messenger model IPA were highlighted when the FTC today announced that it has entered into a consent agreement with Alta Bates Medical Group, Inc., a 600-physician multi-specialty IPA serving Berkeley and Oakland, California, to settle charges that Alta Bates fixed prices charged to health care insurers and refused to deal with insurers on other than a collective basis. According to the FTC, the IPA did not employ a lawful messenger model, but instead collectively negotiated on behalf of its physicians (1) by making proposals and counter-proposals, as well as rejecting or accepting offers, without consulting with its individual physician members regarding the prices they unilaterally would accept; and (2) without transmitting the payors’ offers to its individual physicians until Alta Bates had approved the negotiated prices.
In addition, the complaint alleged that Alta Bates engaged in a concerted refusal to deal to impede competition with Permanente Medical Group by refusing to serve Kaiser fee-for-service enrollees.
This action shows that the dangers of a messenger model can outweigh its potential usefulness as a vehicle to integrate physicians.
Materials regarding this consent are available at http://www.ftc.gov/os/caselist/0510260/index.shtm