American Journal of Law & Medicine

State Acquisition of Hospitals: Federal Court Finds Hospital Authorities Have State-Action Immunity to Engage in Anticompetitive Activity - Federal Trade Commission V. Phoebe Putney Health System, Inc

State Acquisition of Hospitals: Federal Court Finds Hospital Authorities Have State-Action Immunity to Engage in Anticompetitive Activity--Federal Trade Commission v. Phoebe Putney Health System, Inc. (1)--On June 25, 2012, the Supreme Court granted the Federal Trade Commission's (FTC) petition for certiorari in the case of Federal Trade Commission v. Phoebe Putney Health System, Inc. (2) The Court will review two issues: (1) whether the Georgia legislature "clearly articulated a ... state policy to displace competition," thereby granting a state hospital authority state-action immunity from federal antitrust laws, and (2) whether state-action immunity would be sufficient to validate the anticompetitive activity in this case given the hospital authority's lack of supervision over the transaction in question. (3)

This case originates from the Hospital Authorities Law (the "Statute"), passed by the Georgia legislature in 1941. (4) The Statute allows for communities to form "hospital authorities" in order to meet community needs for delivery of hospital services. (5) Under the Statute, hospital authorities have the power to acquire hospitals and "lease [them] ... for operation by others." (6) In 1941, Albany-Dougherty County formed the Albany-Dougherty County Hospital Authority ("Hospital Authority") which acquired and began operating Phoebe Putney Memorial Hospital ("Memorial"), one of the largest hospitals in the county. …

Log in to your account to read this article – and millions more.