Holland & Hart Healthcare Law Blog

Federal Court in Maryland Refuses To Prescribe Canadian Drug Import Program For Maryland County.

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 ("MMA") provides that the Secretary of HHS shall promulgate regulations permitting pharmacists and wholesalers to import prescription drugs from Canada into the United States. It also provides that the Secretary may grant to individuals, by regulation, or on a case by-case basis, a waiver of the prohibition of importation of a prescription drug or device or class of prescription drugs or devices, under such conditions as the Secretary determines to be appropriate. Montgomery County, Maryland, hot in pursuit of the option to import prescription drugs from Canada sought a waiver from Mr. Leavitt and was denied. In Montgomery County, Maryland v. Mike Leavitt, et al., Civil Action No. AW-06-477 (D.MD 2006) Montgomery County sought review and a mandatory injunction under the Administrative Procedures Act to compel Mr. Leavit to grant it a waiver.  Late last month, the Court dismissed the County's action without a hearing.

Referral Threat Exposes Cardiology Practice To Inference Claim by Surgeon

In Carl Warren Adams, M.D. v. Rapid City Regional Hospital, Inc., Cardiology Associates, P.C. et al.,  Civ.-04-5067-RHB (D. S. D. 2007), the Plaintiff, a Cardiac Surgeon from Colorado, brought a an action against Rapid City Regional Hospital, Inc.("RCRH") alleging breach of contract of employment and related claims resulting from his prolonged negotiations  with the hospital. RCRH moved for summary judgment on all claims and the District Court granted the dismissal of all claims based on the lack of mutual assent of the parties to all the major terms of the agreement.  Dr. Adams also sued Cardiac Associates, P.C., and some of its officers and physicians asserting interference with his relationship with RCRH and defamation.  The court granted dismissal of the defamation claim on the basis that Dr. Adams would not be able to show the defamation from hospital proceedings because of the bar to his access to peer review information under South Dakota law.  The Court, however, did hold that Dr. Adams had made a sufficient showing to proceed against the cardiologists under a theory of wrongful interference with prospective economic advantage.

Optometrists Eye Antitrust Loss Against Intermoutain Health Care in Utah.

Intermountain Health Care, Inc.("IHC"), and its vertically integrated affiliates, is the 900 pound gorilla of Utah Healthcare. It operates 19 acute care hospitals and 6 surgical centers in Utah (9 Hospitals and 5 surgical centers on the Wasatch front) and 4 managed care plans. The managed care plans through IHC Health Plans, Inc., now called "SelectCare", have enrolled approximately 60% of the managed care market on the Wasatch front. IHC controls  approximately 51 to 55% of the market for hospital and surgical facilities on the front.

In Anderson et al. v. Intermountain Health,Inc. et al,   __F. 3d. ____( 10th Cir. 2006), a group of optometrists who have been excluded from IHC managed care plan panels by IHC brought and antitrust suit against IHC and its affiliates claiming that IHC and a group of ophthalmologists had engaged in a horizontal boycott of the optometrists, that IHC illegal tied its managed care plans to surgical and nonsurgical eye care services offered by the ophthalmologists and that IHC had developed a monopoly in hospital and surgical services on the Wasatch front in Utah. The Case was dismissed on summary judgment by the trial court and the plaintiffs appealed to the federal 10th Circuit Court of Appeals.

North Carolina Court Sidesteps Ethics Issue To Uphold Cardiologist Non-Compete

In evaluating public policy issues related to covenants not to compete contained in physician employment contracts, Courts are beginning to focus more on the effect of enforcement of these clear restraints of trade on the patient community. In the recent case of Calhoun et.al. v. WHA Medical Clinic, PLLC,N0. COA05-1345 (August 1, 2006), the North Carolina Court of Appeals faced not only the general applicability of the AMA Code of Ethics which disfavors non-competes, but also a specific provision in several of the plaintiff's contracts provided,

[N]o provision of this Agreement shall be enforceable by Company or Physician or any court of competent jurisdiction where local, state or federal laws and regulations and/or the AMA Code of Professional Ethics prohibits and/or discourages the conduct described in or intent of the provision(s) sought to be enforced.

Unfortunately for the plaintiff cardiologists the equities in this case swung against the doctors and the Court ducked the frailties in the trial court's interpretation of the contracts.