The complaint, filed in the U.S. District Court for the Southern District of New York, charges New York-Presbyterian with violating Section 1 of the Sherman Act through contractual restrictions that prevent insurers and employers from offering budget-conscious health insurance plans. New York-Presbyterian is the largest and most powerful hospital system in New York City, owning and operating eight hospitals and many outpatient facilities in the area. The lawsuit seeks to enjoin the hospital system from imposing these allegedly anticompetitive contractual provisions.
According to the complaint, New York-Presbyterian imposes plan restrictions in its contracts with payors that prevent them from offering plans that exclude New York-Presbyterian or do not feature the hospital system in the most favored tier. The hospital system allegedly even forbids payors from offering lower copays when patients choose to receive care at New York-Presbyterian's rivals, who are often lower-priced. 'Millions of New Yorkers pay more for healthcare because of these anticompetitive practices,' said Attorney General Pamela Bondi.
The Justice Department alleges these contract restrictions insulate New York-Presbyterian from price competition and limit rival hospitals from competing for patients based on lower prices or better value. The restrictions also prevent the development of budget-conscious plans for New Yorkers that are available in other parts of the United States, according to the complaint.
This marks the second healthcare antitrust case the Antitrust Division has brought this year as part of broader efforts to ensure robust competition in healthcare markets. The case reflects the Trump administration's focus on addressing high healthcare costs through antitrust enforcement, particularly targeting practices that allegedly prevent price competition among healthcare providers.
'Healthcare is a vital sector of our nation's economy that touches the life of every single American,' said Acting Assistant Attorney General Omeed A. Assefi of the Justice Department's Antitrust Division. 'New York-Presbyterian has known for years that the American consumer wants budget-conscious health plans that reduce healthcare costs. But rather than offer consumers choice, New York-Presbyterian uses its market power to protect its margins, impede competition from rival hospitals, and prevent employers and unions from creating these plans.'
U.S. Attorney Jay Clayton for the Southern District of New York emphasized the local impact, stating: 'The high cost of healthcare is frustrating to every New Yorker. Our Office will continue to work with our partners in the Antitrust Division to investigate and confront anticompetitive practices that contribute to higher healthcare costs.'
The case represents a significant test of antitrust enforcement in healthcare contracting, an area where federal regulators have increasingly scrutinized hospital systems' use of contract terms that may limit insurer flexibility in plan design. The outcome could have implications for how major hospital systems structure their payor contracts nationwide.