The University of Utah has hired a team of lawyers from three law firms to represent the university, a private physicians' corporation and a university doctor during an antitrust investigation conducted by the Utah attorney general's office.
After remaining silent for several months, the attorney general's office officially confirmed Tuesday that it is investigating whether agreements between the state-owned U. Medical Center and Intermountain Health Care's Primary Children's Medical Center may violate antitrust laws.Additionally, an attorney for the U.S. Department of Justice announced at a recent meeting in Boston that the government is consulting with Utah in its investigation, according to the Federal Trade Commission news bureau. Top antitrust enforcers for the Justice Department and the FTC's Bureau of Competition have launched aggressive campaigns to ensure competition to keep health prices down.
The Utah attorney general's investigation focuses on the pediatric and newborn intensive care units of both hospitals and a private corporation formed by the doctors of the U.'s Department of Pediatrics. The same doctors are affiliated with Primary Children's.
"It is obvious from reports that the news media has received that indeed we are investigating the relationship between the University Hospital and Primary Children's Medical Center," Chief Deputy Attorney General Joe Tesch told the Deseret News Tuesday. "This is an antitrust concern that has existed since Primary Children's located its physical hospital next to the University Hospital."
Tesch said in 1985, when the U. was negotiating with Primary to move to the U. medical campus, the attorney general's office issued an opinion "that there were potential antitrust problems if things were to occur such as an allocation of patients."
"It's no secret from reports in the media that certain events have occurred between the U. Hospital and Primary Children's which on the surface are capable of being interpreted in a fashion that raises serious antitrust questions," he said.
To address these questions, the U. hired counsel from Ray Quinney & Nebeker to represent all three entities - the university, Pediatric Faculty Physicians Inc. and Dr. Michael A. Simmons.
Counsel from Snow Christensen & Martineau has been and is representing PFP, a private corporation of about 85 pediatricians at the U. and Primary. Counsel from Parsons Behle & Latimer has been hired to represent Simmons, chairman of both the department of pediatrics and PFP. He is also medical director at Primary Children's.
The university pays for all three teams of lawyers.
James S. Jardine, chairman of the U.'s Institutional Council, said PFP lawyers are reimbursed by funds either generated by PFP or returned to the university by it on an on-going basis "because PFP is a billing arm for most of the pediatric faculty."
It was after interviewing three Salt Lake law firms with medical antitrust experience that the university selected Jonathan A. Dibble of Ray Quinney & Nebeker to represent the school. Jardine is an attorney with that firm but said he did not participate in the selection process and stressed that he personally does not bill the U. for work he does on the case.
Simmons told the Deseret News that U. lawyers advised him to retain his own counsel as well and agreed to pay for it. His attorney is Raymond J. Etcheverry of Parsons Behle & Latimer.
John Dwan, U. Hospital spokesman, said the U. decided to pay for Simmons counsel because "that need for counsel is seen as rising from the proper discharge of his duties and responsibilities as chairman of pediatrics."
So how much do all these lawyers cost? No one will say.
"We are billing at the most $125 an hour," Dibble said. "That's a discount."
Jardine said, "At this very preliminary data-gathering stage there have been efforts not to duplicate work and from my observation, there haven't been substantial fees incurred." Because taxpayer money pays for the lawyers, Jardine said the amount the U. ultimately pays will be public record.
But according to Tesch, health-care costs - not lawyer fees - are the primary issue.
"The position of the attorney general is that competition between the only two hospitals which provide in-depth care in a broad spectrum to children is necessary in order to keep costs low and to ensure the best possible care," he said. "We believe that the University of Utah also agrees with that objective."
Tesch said the attorney general's office is "cooperating as much as possible within the framework of doing an arms-length investigation with the university and its health science institutions to accomplish the review and investigation of certain events as efficiently and with as little cost to the taxpayer as possible."
He stressed, "However, we believe that proper investigation and preventive measures taken at this time will ultimately save the citizens of Utah using those services and the taxpayers money in the long run."
Dr. William A. Gay Jr., U. vice president for health sciences, said that "most of the formal inquiries made by the attorney general have now been answered in writing."
But an IHC official said the corporation hasn't been contacted by the attorney general concerning any antitrust investigation.
"We are unaware of any violation of state or federal antitrust law. If any investigation is forthcoming, we would cooperate fully with the attorney general's office," said Douglas J. Hammer, vice president and general counsel for IHC.