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February 24, 2022

Hartford HealthCare asks judge to dismiss antitrust lawsuit; says it outcompeted St. Francis Hospital for docs

Photo | Greg Bordonaro Hartford HealthCare's headquarters in downtown Hartford.

In response to a recent lawsuit by its cross-town competitor accusing it of anti-competitive practices, Hartford HealthCare is fighting back against the allegations, arguing it hasn’t violated antitrust laws and that St. Francis Hospital and Medical Center was outcompeted for physicians. 

In a 49-page document filed Wednesday night in the U.S. District Court in New Haven, Hartford HealthCare asked Judge Alfred Covello to dismiss St. Francis Hospital’s lawsuit, arguing, among other things, the care provider lacks antitrust standing and had the financial capabilities to compete harder for physicians.

“Hartford Healthcare and other competing systems in Connecticut have indeed successfully competed to recruit some physicians to their systems who formerly practiced at St. Francis,” according to the HHC motion to dismiss. “That leaves St. Francis with a choice. One option is to compete harder to recruit and retain physicians. There is no reason it could not do so, particularly given its massive financial resources — it has higher operating margins than Hartford HealthCare, and is owned by industry giant Trinity Health, a system that includes about 90 other hospitals.”

(In fiscal 2020, Trinity Health of New England reported $1.6 billion in operating revenue in Connecticut vs. $4.3 billion reported by Hartford HealthCare, according to Office of Health Strategy data. Trinity Health's parent company reported $20.2 billion in revenue in fiscal 2021, according to its website.)

St. Francis Hospital in January sued Hartford HealthCare and its subsidiaries, including Hartford Hospital, claiming that it is trying to create a monopoly on hospital services by acquiring physician networks, particularly cardiologists, and demanding that they refer their patients only to Hartford HealthCare. 

The lawsuit alleges “a campaign of exclusion, acquisition and intimidation” and claims that Hartford HealthCare executives have stated in meetings that their plan was to “crush” or “bury” St. Francis.

The lawsuit claims that Hartford HealthCare, as it has acquired physician practices over the last four years, has threatened and intimidated physicians who don’t comply with its “dictates.”

The lawsuit names 21 physicians whose practices were acquired by Hartford HealthCare over the last four years and nine others who became exclusively affiliated with Hartford HealthCare’s network, known as Integrated Care Partners, or ICPs. 

St. Francis is seeking financial damages, a court order to divest any physician practices that Hartford HealthCare has purchased since 2020 and a permanent injunction prohibiting what

it describes as “anti-competitive conduct.”

READ MORE ABOUT THE ST. FRANCIS LAWSUIT HERE 

In its motion to dismiss the lawsuit, Hartford HealthCare said St. Francis “chose not to compete,” for physicians and “instead filed this lawsuit in an effort to chill Hartford HealthCare’s competitive activities and limit the employment opportunities available to Connecticut’s physicians, even in the wake of Trinity Health’s recent employee furloughs and layoffs. The antitrust laws do not, however, provide St. Francis with such an anti-competitive remedy.”

With specific regard to the antitrust claims, HHC wrote they “fail because the antitrust laws do not give it the right to interfere with physician-employees’ decisions as to where to work, even if those employment decisions allegedly harm St. Francis’s business.”

The motion to dismiss cites several past court decisions to make its argument regarding antitrust standing. Specifically, it notes the U.S. Supreme Court decision in Brunswick Corp v. Pueblo Bowl-O-Mat that “reinforces the principle that a plaintiff lacks antitrust standing where its injuries arise simply from a loss of business to a competitor, and not a reduction in competition.”

HHC also denies that it threatened and intimidated physicians who didn’t comply with its so-called dictates.

In a statement issued Thursday morning, HHC said: “St. Francis, which is one of almost 90 hospitals across the nation run by Michigan-based Trinity Health, is bringing this suit not because of a reduction in competition, but because of competition itself — the kind of competition and innovation that benefits patients and that antitrust laws are designed to protect. Further, St. Francis is attempting to interfere with where physicians may choose to do their work.”  
 
The HHC statement continues: “St. Francis’s suit has no merit and distorts the many ways Hartford HealthCare serves the community. For these and other reasons, St. Francis’s claims should be dismissed.”

St. Francis Hospital issued its own statement Thursday saying: "We are aware Hartford HealthCare has filed a response to our complaint. We strongly disagree with Hartford HealthCare’s position and remain committed to protecting our patients, physicians and the community. Our ultimate goal remains that the residents of the greater Hartford area have access to health care that is high in quality with lower costs."

Legal representation

HHC in recent weeks has hired some heavy-hitter law firms for its defense. 

In addition to local representation by Shipman & Goodwin, it has asked the court permission to bring on lawyers from two national firms: Gibson, Dunn & Crutcher, which has more than 1,500 lawyers in 20 offices worldwide; and Sheppard, Mullin, Richter & Hampton, with nearly 1,000 lawyers in North America, Europe and Asia.

St. Francis is represented by attorneys from Hinckley Allen, including lead attorney William Fish. It also lists representation by national law firm Honigman.
 
This isn’t the only lawsuit Hartford HealthCare is facing.
 
Last week, a group of Connecticut residents filed a proposed class-action lawsuit against Hartford HealthCare, alleging the network uses its market dominance to charge higher prices to the state’s commercially insured residents. The 60-page complaint filed in Hartford Superior Court claims HHC used anti-competitive practices to create a monopoly on inpatient hospital services and leveraged its market power to charge insurers higher rates for those services and others, the costs of which were passed onto the state’s employers and consumers. 

Hartford HealthCare said that lawsuit is also without merit and that it will fight it in court. 

A CT Mirror report was included in this story. 

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