Community deserves better from PeaceHealth.

Byline: MARSHALL L. WILDE For The Regster-Guard

THE PENDING ANTITRUST battle between McKenzie-Willamette Hospital and PeaceHealth brings to light the effect of antitrust law on patient choice. McKenzie-Willamette has accused PeaceHealth of wielding its power as a monopoly in the big-money areas of tertiary cardiovascular and neonatal intensive care in an effort to corner the market in the areas of primary and secondary care.

PeaceHealth has an obvious financial motive to expand its market share in primary and secondary services in its proposed expansion into Springfield. By cornering this market, it has a much greater chance in filling its new beds. PeaceHealth has attempted to characterize its actions as a good package deal for consumers, but its purported conduct effectively limits patient choice in the Eugene-Springfield area through an illegal tying of services.

The difference between a package deal and an illegal tie is not always obvious. Most of us see package deals every day, from free microwave popcorn at the video store to lollipops at the dentist.

Tying, the illegal version of this practice, recently made the news in a federal judge's finding that Microsoft illegally required computer manufacturers to purchase Internet Explorer with the company's Windows operating system.

The monopolistic power of the seller often defines the difference between a package deal and an illegal tie. Microsoft enjoyed a virtual monopoly in operating systems and used that monopoly to substantially expand its market share in another product line, Internet browsers, despite the presence of a competitor with an arguably better product, Netscape.

Drawing an analogy, imagine if the only place your child could buy a lollipop was at the dentist's office - and the dentist refused to sell your child a lollipop unless you agreed to receive all your dental services from him.

McKenzie-Willamette has alleged that PeaceHealth used its virtual monopoly in high-end services to leverage an undeservedly high share of the primary and secondary care market. According to McKenzie-Willamette's complaint, PeaceHealth offered Regence Blue Shield, the insurer of about 35 percent of Lane County residents, two options in purchasing PeaceHealth's services for its customers. If Regence agreed to an exclusive deal prohibiting Regence from contracting with any other providers, PeaceHealth would offer Regence a below-market rate for its high-end services. If Regence kept the option of contracting with other providers (like McKenzie-Willamette), then PeaceHealth would allegedly charge an above-market rate. Regence apparently accepted the exclusive contract to provide lower-cost services to its customers. PeaceHealth denies the allegations.

In the alternative, assuming McKenzie-Willamette proves the differently priced offers, PeaceHealth claims that it did not force Regence to purchase its primary and secondary services, but rather only gave the insurer an economic incentive to do so. PeaceHealth's argument has some legal merit, as the only case law on the subject requires that, in the absence of an explicit requirement to buy the other product, there be no economically viable alternative to purchasing the tying product. In all likelihood, McKenzie-Willamette will have to prove that the pricing scheme effectively cut off Regence's option to choose. Should it fail, McKenzie-Willamette claims it will be effectively driven out of business by PeaceHealth's monopolistic behavior.

As patients, we deserve better than this. If the facts are as alleged, PeaceHealth effectively told 35 percent of us that we can receive its high-end services only if we use its low-end services, unless we would like to pay dearly for the privilege.

Worse yet, PeaceHealth has an effective monopoly on these services. These services can be very time-sensitive. None of us can effectively choose to seek other services in Salem or Portland when we need emergency cardiac surgery or our newborn child develops trouble breathing. On top of that, PeaceHealth's policy could require many of us to change physicians or pay a premium to stay with our current primary and secondary providers.

We also deserve better from PeaceHealth as a religious charity. PeaceHealth did not establish its monopoly in these tertiary services through improper means. It started offering these services because it wanted to fill a need in our community and PeaceHealth was the only facility both willing and able to expend the substantial sums necessary to start up such a venture.

However, as a religious charity, PeaceHealth owes us a duty to provide these services on reasonable terms. As a monopoly, the law only prohibits PeaceHealth from using its power unreasonably to drive competitors out of business. As taxpayers we give PeaceHealth, as a charitable non-profit, a substantial break in the cost of doing business by exempting it from many forms of taxation in exchange for its agreement to act in the public good. As a religious organization, PeaceHealth should realize that the dictates of conscience and faith require it to deal fairly with the public. It cannot both serve God and money.

We should care about antitrust law because we care about health care choices. PeaceHealth's allegedly monopolistic behavior is more than a simple package deal - it has the potential to deprive us of our choice of physicians and services. As a community, we have the most choices when we preserve fair competition.

Marshall L. Wilde is a graduate of the University of Oregon Law School, a former health care attorney for the United States Air Force, and a current Healthcare Master of Laws student at the University of Houston.