Four hospitals in Michigan are being sued by the U.S. Department of Justice for allegedly conspiring to carve out marketing territories in the state to limit competition between the facilities and keep consumers from learning about competing providers.
According to the DOJ, Hillsdale Community Health Center, Community Health Center of Branch County, ProMedica Health System and W.A. Foote Memorial Hospital, doing business as Allegiance Health, colluded to limit competition. All but W.A. Foote agreed to settle the charges.
[Also: Running list of notable 2015 healthcare frauds]
“Instead of putting patients first, these hospitals secretly agreed not to compete,” said Assistant Attorney General Bill Baer in a statement. This action will terminate the agreements limiting marketing and make sure the citizens of south-central Michigan will have access to the facts they need to make informed healthcare choices.”
In addition to limiting marketing to consumers, the hospitals also blocked patients from accessing free screenings and seminars at hospitals outside of their “territory.”
Under the settlement, Hillsdale, Branch and ProMedica would be barred from agreeing with other healthcare providers to limit marketing or carve up geographic territories. They also must not discuss marketing strategies between them.
Follow Healthcare Finance on Twitter and LinkedIn.
Hillsdale’s hospital has 47 beds and more than 90 physicians, Allegiance’s hospital has 480 beds and more than 400 physicians on staff and Branch’s hospital has 87 beds and more than 100 physicians.
ProMedica, a larger corporation, runs the Bixby and Herrick hospitals in Michigan. Bixby has 88 beds and more than 120 physicians while Herrick has 25 beds and more than 75 physicians.
Twitter: @HenryPowderly