The U.S. Department of Justice recently reached a settlement in its first case since 1999 that challenges monopoly behavior under Section 2 of the Sherman Antitrust Act. In February, the DOJ filed a complaint in District Court for the Northern District of Texas against United Regional Health Care System. The civil complaint alleged that United Regional maintained its local monopoly by requiring health insurers to enter into illegal contracts.
According to the complaint, United Regional is the largest hospital in Wichita Falls, Texas. The DOJ alleged that United Regional had monopoly power in two markets: “(1) the sale of general acute-care inpatient hospital services (inpatient hospital services) to commercial health insurers, and 2) the sale of outpatient surgical services to commercial health insurers.” The complaint alleges that United Regional has a 90 percent market share in the first market and in excess of 65 percent market share in the second market. United Regional is the only provider of certain essential services, such as cardiac surgery, obstetrics and high level trauma care. The complaint further alleges that United Regional’s average per-day rate for inpatient services is about 70 percent higher than its closest competitor’s.
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