UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
UNITED STATES OF AMERICA and
STATE OF FLORIDA
Plaintiffs,
v.
MORTON PLANT HEALTH SYSTEM, INC. and
TRUSTEES OF MEASE HOSPITAL, INC.,
Defendants.
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Civil Action No. 94-748-CIV-T-23E
Judge Steven D. Merryday
|
MOTION AND
STIPULATION FOR ENTRY OF AN ENFORCEMENT ORDER
The United States of America, the State of Florida, Morton Plant Hospital
Association,
Inc., formerly known as Morton Plant Health System, Inc. ("Morton Plant"), the Trustees of
Mease Hospital, Inc. ("Mease"), and Morton Plant Mease Healthcare, Inc. ("MPMHC"), hereby
stipulate and agree to the entry of the attached Enforcement Order pursuant to ¶ X of the
Final
Consent Judgment ("FCJ") entered in this action on September 29, 1994, and extended, pursuant
to ¶ XI of the FCJ, on September 29, 1999.
The parties further stipulate and agree as follows:
1. Morton Plant and Mease hereby admit that they violated provisions of the
FCJ
through the following business activities.
- Violations of ¶ V, relating to the bona fide Partnership
- Paragraph V(B) of the FCJ permits Morton Plant and Mease to
create a bona fide partnership (the "Partnership") to produce
outpatient, specified inpatient, and certain administrative services.
With limited exceptions, the Partnership is to sell all such services
back to Morton Plant and Mease exclusively, and the hospitals are
then to compete in the sale of these services to third parties. By
requiring the Partnership to sell these services exclusively to
Morton Plant and Mease for subsequent resale to third parties,
competition in the sale of these services is to continue despite their
joint production. Between 1994 and 2000, however, the
Partnership sold these outpatient services directly to managed care
plans and others, in violation of the FCJ.
- Paragraph V(C) of the FCJ prohibits executives of the Partnership
from discussing managed care contracting or the marketing or
pricing of any services for Morton Plant or Mease. This provision
was violated during various meetings in which Partnership
executives discussed managed care contracting with representatives
of the hospitals. At several of these meetings, certain Partnership
executives gave identical directives to each of the hospitals on
managed care contracting goals and objectives, coordinating
Morton Plant's and Mease's managed care contracting activities in
violation of the FCJ.
- Paragraph V(I) of the FCJ requires the Partnership to establish
adequate protections to keep information concerning pricing,
managed care contracts, negotiations with managed care plans, and
marketing and planning of Morton Plant and Mease separate and to
insure that the information of one hospital is not transmitted to or
received by the other hospital, whether directly or indirectly. On
various occasions, however, Partnership personnel transmitted
information and recommendations on managed care contracting and
pricing to both hospitals and coordinated the sale of services to
various managed care plans, in violation of the FCJ.
- Violations of ¶ VI, relating to Independent Activities
- Paragraph VI(A) of the FCJ requires Morton Plant and Mease to
continue as separate and competing corporate entities. Marketing,
pricing, and managed care negotiating and contracting decisions
must all be conducted independently. As discussed above, the
hospitals, on various occasions, used the Partnership to share
competitively sensitive information, coordinate managed care
contracting decisions, and jointly sell certain services, all in
violation of the FCJ.
- Paragraph VI(B) of the FCJ requires Morton Plant and Mease to
price and sell their services, including Partnership Services, in active
competition with each other, and to independently market and price
their services. With limited exceptions, they are not permitted to
discuss, communicate, or exchange with each other information
relating to the marketing, pricing, negotiating, or contracting of any
patient or administrative services. Following entry of the FCJ,
however, the hospitals on various occasions took direction from the
Partnership regarding the marketing and pricing of their services,
used the Partnership as a means of selling services jointly, and
shared contracting information with each other as well as with other
hospitals in Pinellas County, through their participation in the
BayCare Health Network, all in violation of the FCJ.
- Paragraph VI(D) of the FCJ requires Morton Plant and Mease to
negotiate and contract independently with health care purchasers.
They are permitted to contract with the same purchasers and to
enter into similar, but separate, contracts with these purchasers.
However, on various occasions Morton Plant and Mease
simultaneously negotiated identical contracts with the same
managed care plans, using the Partnership to coordinate and obtain
identical provisions and rates, all in violation of the FCJ.
- Violations of ¶¶ VII-VIII, relating to the Compliance Program and
Certifications
- Paragraph VII(C) of the FCJ requires Morton Plant and Mease to
annually brief their officers, directors, trustees, and administrators
on the meaning and requirements of the FCJ, penalties for its
violations, and their duties under the antitrust laws. Though the
hospitals provided some form of briefing at various points after the
entry of the FCJ, such briefings did not fully or adequately explain
the requirements of the FCJ, failing to prevent the violations
described herein.
- Paragraph VII(D) of the FCJ requires Morton Plant and Mease to
obtain from their respective officers and administrators an annual
certification that s/he has read, understood, and agrees to abide by
the FCJ and is not aware of any violations of this FCJ. While the
hospitals obtained a form of compliance certification from the
relevant individuals, these certifications did not, in all cases, provide
for an affirmation, as called for by the FCJ, that the individual was
not aware of any violations of the FCJ.
- Paragraph VIII(B) of the FCJ requires Morton Plant and Mease to
certify annually to the United States and the State of Florida that
they have complied with ¶ VII's Compliance Program. The
hospitals made these certifications, but did so falsely insofar as (1)
they had failed to obtain the proper certifications from certain
officers and administrators, and (2) they did not inform the United
States or the State of Florida of the violations they had discovered
or reasonably should have discovered as early as 1996.
2. The United States, the State of Florida, Morton Plant, Mease, and
MPMHC
hereby stipulate and agree that this Motion and Stipulation and the attached Enforcement Order
are an appropriate and complete disposition with respect to each of the violations of the FCJ
described above.
3. Morton Plant, Mease, and MPMHC hereby further stipulate and agree to
be bound
by the attached Enforcement Order pending entry of that Order (except as otherwise provided) by
this Court.
4. In the event that the Court declines to enter an Enforcement Order in the
form
attached hereto, this Motion and Stipulation and the attached Order shall be of no effect whatever
and the making of this Stipulation shall be without prejudice to any party in this or any other
proceeding, including without limitation the ability to assert additional claims or defenses or to
dispute some or all of the matters asserted herein.
Dated: June 28, 2000
MORTON PLANT HOSPITAL
ASSOCIATION, INC.
_________________/S/___________________
HARREL ZIECHECK, Chief Operating Officer
Morton Plant Hospital Association, Inc.
30 Pinellas Street
Clearwater, Florida 33756
(727) 462-7100
TRUSTEES OF MEASE HOSPITAL, INC.
_________________/S/__________________
JAMES A. PFEIFFER, Chief Operating Officer
Mease Hospitals, Inc.
601 Main Street
Mail Stop #403
Dunedin, Florida 34698
(727) 734-6365
MORTON PLANT MEASE HEALTHCARE, INC.
_________________/S/_____________________
PHILIP K. BEAUCHAMP, President and CEO
Morton Plant Mease Healthcare, Inc.
601 Main Street
6th Floor Mail Stop #429
Dunedin, FL 34698
(727) 734-6226
MACFARLANE, FERGUSON & MULLEN
_________________/S/________________
JAMES A. MARTIN, JR.
Attorney for Defendants
625 Court Street, Suite 200
Clearwater, Florida 33756
(727) 441-8966
HONIGMAN MILLER SCHWARTZ & COHN
_________________/S/_________________
DAVID A. ETTINGER
Attorney for Defendants
2290 First National Building
660 Woodward Avenue
Detroit, Michigan 48226
(313) 465-7368 |
UNITED STATES OF AMERICA
___________/S/________________
PAUL J. O'DONNELL
U.S. Department of Justice
Antitrust Division
325 7th Street, N.W.,
Suite 400
(202) 616-5933
__________/S/_________________
ROBERT A. BUTTERWORTH
Attorney General
State of Florida
__________/S/_________________
RICHARD E. DORAN
Deputy Attorney General
__________/S/_______________
PATRICIA A. CONNERS
Chief, Antitrust Section
__________/S/_________________
LIZABETH A. LEEDS
Assistant Attorney General
PL-01
The Capitol
Tallahassee, Florida 32399-1050 |
|