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*This post was co-authored by Lily Denslow, legal intern at Robinson+Cole. Lily is not admitted to practice law.

In April, the Federal Trade Commission (FTC) promulgated a new rule banning non-competes (the Rule); the FTC adopted the Rule to prohibit employers from entering into or enforcing non-compete clauses with workers and senior executives. Several lawsuits…

This post was co-authored by Josh Yoo, legal intern at Robinson+Cole. Josh is not admitted to practice law.

Health care entities maintain compliance programs in order to comply with the myriad, changing laws and regulations that apply to the health care industry. Although laws and regulations specific to the use of artificial intelligence (AI) are limited at this time and in the early stages of development, current law and pending legislation offer a forecast of standards that may become applicable to AI. Health care entities may want to begin to monitor the evolving guidance applicable to AI and start to integrate AI standards into their compliance programs in order to manage and minimize this emerging area of legal risk.

Executive Branch: Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence

Following Executive Order 13960 and the Blueprint for an AI Bill of Rights, Executive Order No. 14110 (EO) amplifies the current key principles and directives that will guide federal agency oversight of AI. While still largely aspirational, these principles have already begun to reshape regulatory obligations for health care entities. For example, the Department of Health and Human Services (HHS) has established an AI Task Force to regulate AI in accordance with the EO’s principles by 2025. Health care entities would be well-served to monitor federal priorities and begin to formally integrate AI standards into their corporate compliance plans.

  • Transparency: The principle of transparency refers to an AI user’s ability to understand the technology’s uses, processes, and risks. Health care entities will likely be expected to understand how their AI tools collect, process, and predict data. The EO envisions labelling requirements that will flag AI-generated content for consumers as well.
  • Governance: Governance applies to an organization’s control over deployed AI tools. Internal mechanical controls, such as evaluations, policies, and institutions, may ensure continuous control throughout the AI’s life cycle. The EO also emphasizes the importance of human oversight. Responsibility for AI implementation, review, and maintenance can be clearly identified and assigned to appropriate employees and specialists.
  • Non-Discrimination: AI must also abide by standards that protect against unlawful discrimination. For example, the HHS AI Task force will be responsible for ensuring that health care entities continuously monitor and mitigate algorithmic processes that could contribute to discriminatory outcomes. It will be important to permit internal and external stakeholders to have access to equitable participation in the development and use of AI.

Continue Reading Forecasting the Integration of AI into Health Care Compliance Programs

Below is an excerpt of an article, co-authored with Antitrust and Trade Regulation Team lawyer Jen Driscoll and Internal Investigations and Corporate Compliance chair Ed Heath, published in the American Health Law Association’s Health Law Weekly newsletter on January 19, 2024.

Mergers and acquisitions in health care markets are viewed with heightened scrutiny by…

On June 2, 2022, the Federal Trade Commission announced a pair of antitrust enforcement actions to block pending health system transactions that, according to it, would harm competition in the provision of inpatient general acute care hospital services.Continue Reading FTC Takes Action to Block Hospital Transactions in Utah and New Jersey

On March 24, 2020, the Department of Justice (DOJ) and Federal Trade Commission (FTC) issued a joint statement on COVID-19-related antitrust enforcement highlighting ways “firms, including competitors, can engage in procompetitive collaboration that does not violate the antitrust laws” to protect public health and safety. The DOJ and FTC emphasized their commitment to facilitating antitrust compliance for businesses that are responding to the national emergency. In furtherance of this position, the agencies gave examples of collaborative activities designed to improve health and safety during the COVID-19 pandemic that are unlikely to run afoul of the antitrust laws, absent exceptions. These include:

  • Collaboration on research and development as “efficiency-enhancing integration of economic activity” which is typically procompetitive.
  • Sharing technical know-how – rather than company specific data about prices, wages, outputs, or costs – as necessary to achieve procompetitive benefits of collaboration.
  • The “development of suggested practice parameters – standards for patient management developed to assist providers in clinical decisionmaking” by providers will not be challenged except in extraordinary circumstances.
  • Joint purchasing arrangements among health care providers “designed to increase the efficiency of procurement and reduce transaction costs.”
  • “[P]rivate lobbying addressed to the use of federal emergency authority, including private industry meetings with the federal government to discuss strategies on responding to COVID-19, insofar as those activities comprise mere solicitation of governmental action with respect to the passage and enforcement of laws.”

Continue Reading DOJ and FTC Issue Joint Statement on Antitrust Enforcement and the COVID-19 Pandemic

On February 27, 2020, the Federal Trade Commission (FTC) announced an action to block a proposed transaction between Thomas Jefferson University d/b/a Jefferson Health (Jefferson) and Albert Einstein Healthcare Network (Einstein). Jefferson and Einstein entered into a “System Integration Agreement” in late 2018 under which Jefferson would become the sole member (i.e., owner) of Einstein and oversee a 14-hospital system (11 of which would be located in Pennsylvania). According to the FTC, Jefferson and Einstein are leading providers of inpatient general acute care (GAC) hospital services and inpatient acute rehabilitation services in Philadelphia County and Montgomery County, Pennsylvania, and therefore the FTC now challenges the proposed integration on the basis that it will substantially harm competition for those services in both Philadelphia and Montgomery counties.
Continue Reading FTC and Commonwealth of Pennsylvania Challenge Proposed Hospital Merger

On January 10, 2020, The Department of Justice (DOJ) and Federal Trade Commission (FTC) announced new draft vertical merger guidelines for public comment. Once finalized, the draft guidelines will replace the DOJ’s 1984 Non-Horizontal Merger Guidelines and describe how the FTC and the DOJ will analyze and enforce vertical mergers for compliance with the antitrust laws. Vertical mergers combine two or more companies operating at different levels of the same supply chain, e.g., a combination between a hospital and independent physician group, or a health system and a skilled nursing facility. The draft guidelines adopt common concepts from the Horizontal Merger Guidelines, such as the definition of a “market,” the framework for analyzing the sale of a failing business or its assets, and the purchase of partial ownership interests. Notably, and to the disappointment of many within the health care community, the draft guidelines provide little guidance on vertical mergers specific to the health care industry. Additionally, two FTC Commissioners abstained from voting on the draft guidelines and issued statements outlining their concerns that the guidelines are too lenient toward vertical mergers.
Continue Reading DOJ and FTC Announce Draft Vertical Merger Guidelines

On June 13, 2019, the U.S. Court of Appeals for the Eighth Circuit affirmed a preliminary injunction granted to the Federal Trade Commission (FTC) and North Dakota Attorney General (NDAG) blocking the proposed acquisition of Mid-Dakota Clinic, P.C. (MDC) – a multispecialty physician group in North Dakota – by Sanford Health, a large South Dakota-based health system (Sanford). This decision may foreclose continued pursuit of MDC by Sanford, and represents another success for the FTC in challenging health care consolidation (see our previous analysis of the granting of the injunction here, and of the FTC’s intervention here).
Continue Reading Eighth Circuit Affirms Preliminary Injunction Blocking Physician Practice Acquisition in North Dakota

On December 13, 2017 a magistrate judge in the U.S. District Court for the District of North Dakota granted a request of the Federal Trade Commission (FTC) and North Dakota Attorney General to preliminarily enjoin Sanford Health from completing its proposed acquisition (via its subsidiary Sanford Bismarck) of Mid Dakota Clinic, P.C., a multispecialty physician practice located in and around the cities of Bismarck and Mandan, North Dakota (see our previous analysis of the FTC’s decision to intervene here).
Continue Reading FTC Granted Preliminary Injunction to Block Physician Practice Acquisition

On June 22, 2017 the Federal Trade Commission (FTC) filed an administrative complaint and a request for a preliminary injunction in federal court to block a proposed physician practice acquisition in North Dakota (the Transaction), the agency’s latest intervention in opposition to consolidation at the physician practice level. In this case, the FTC (accompanied by the Attorney General of North Dakota) opposes a proposed acquisition of Mid Dakota Clinic, P.C. (MDC) by Sanford Bismarck (a subsidiary of multi-state health system Sanford Health, collectively Sanford) on the grounds that the Transaction, if consummated, would represent an unfair method of competition in violation of Section 5 of the FTC Act (15 U.S.C. § 45) and may substantially lessen competition in violation of Section 7 of the Clayton Act (15 U.S.C. § 18).
Continue Reading FTC Intervenes in Physician Practice Acquisition in North Dakota