How physicians can avoid legal problems resulting from a merger


Physicians who are considering being part of a merger should weigh their risks and take steps to reduce potential legal hurdles - here are some suggestions based on my experience facilitating physician practice mergers:

Communicate with physician owners and employees. When a medical group is not transparent, negative rumors may persist. Physicians should be as open as possible about the details of a merger so employees feel comfortable. Incorrect assumptions can lead to distrust and inaccurate information.

Retain experienced advisers. Doctors should confer with attorneys, antitrust experts and other specialists early on. Such consultants can make sure potential problems are discussed before they arise.

Review the reasons for the merger. Medical groups should have pro-competitive reasons for merging such as improving quality of care or access to treatment. Health professionals should be sensitive to their market share and realize the larger the group becomes, the more likely it could attract suspicion of anti-competitive behavior.

Discuss how to integrate. Groups that merge sometimes want to maintain independent autonomy by keeping their names or staying in the same location. However, consolidated groups must be able to demonstrate they are working as one unit to prevent Federal Trade Commission scrutiny.

Obtain relevant data. Before a merger, health professionals should obtain data on the number of competitors in their community to better defend against an antitrust challenge. They should be able to present information about why their merger would not harm competition.

Request an opinion. If concerned about antitrust issues, doctors can ask the FTC to review their plan and issue an advisory opinion. The opinion is not binding, but can offer the group necessary guidance on whether it should move forward.

Have questions? I’m here to help.