Case Scenario:
Memorial Hospital, a hospital in Bordertown, Iowa, has an agreement with Careco, a managed care organization with plan members in the states of Iowa, Nebraska, and South Dakota, to provide medical care to its members. A condition of Memorial’s agreement with Careco states that Careco cannot contract with other hospitals in the Bordertown, Iowa, area. The contract is for one year, and either party may terminate the contract for any reason (with a 60-day notice period).
- Discuss any possible antitrust laws that Memorial may have violated by initiating this agreement with Careco. Mention concerns specific to healthcare, that is, concerns not shared by other industries. Also, discuss any defenses that Memorial can establish for an antitrust action.