ALBANY, Ga. — After Phoebe Putney Health System filed its respondent brief with the U.S. Supreme Court last week in connection to the Federal Trade Commission’s opposition to the purchase of Palmyra Medical Center, several organizations filed amicus briefs backing Phoebe’s case.
“We are pleased these prestigious organizations have filed briefs on our behalf,” said Tommy Chambless, general counsel with Phoebe. “They provide relevant matter for the court to consider. They further illuminate the threat of the FTC’s position to the balance between the authority that properly belongs to the state versus that of the federal government. A respectful relationship between the states and the federal government should not be tossed aside as the FTC’s position would do.”
The American Hospital Association (AHA) and Georgia Hospital Association (GHA) filed one such brief, which makes the case that the State Action Doctrine arises from the presumption — rooted in the nation’s federalist system — that Congress does not intend for federal law to intrude on state power.
“The Court did not simply create the state-action doctrine from whole cloth,” the brief reads. “Rather, it follows from the Court’s longstanding presumption — now incorporated into a ‘plain-statement rule’ — that Congress must draft specific and unambiguous federal laws if it intends to intrude on traditional state prerogatives.”
To that end, the State Action Doctrine is simply another application of the general plain statement rule, the brief goes on to say.
“... On their face, the Sherman Act, the Clayton Act, and other antitrust laws do not exclude state regulatory schemes or state actors implementing them,” the brief states. “But neither do these laws specifically indicate that they apply to those state regulatory regimes or actors. Rather, the antitrust laws use highly general language that ‘makes no mention of the state as such, and gives no hint that [they were] intended to restrain state action or official action directed by a state.”
The AHA and GHA brief continue that the plain statement rule presumes federal laws are not meant to interfere with the relationship between states and their political subdivisions, and that the FTC’s position conflicts with the Court’s federalism-based “hands off” approach to the relationship between the states and their subdivisions.
Another brief filed this week by the National Association of Public Hospitals and Health Systems (NAPH) and Georgia Alliance of Community Hospitals (GACH) also supports the Hospital Authority of Albany-Dougherty County’s purchase of Palmyra, now known as Phoebe North.
“The FTC seeks to radically change the law and improperly circumvent the long-established ‘state-action’ immunity defense with arguments that amount to a thinly-veiled grab for new powers to micromanage the operations of hospital authority-owned hospitals in Georgia, and publicly served hospitals nationwide,” NAPH and GACH brief states.
The brief also points to Georgia’s hospital Certificate of Need law, regulation of staff privileges and peer review to argue that there are means for providing a clear regulatory alternative to competition.
“This comprehensive state health care regulatory structure serves important public needs and reflects a careful policy determination of the Georgia General Assembly to restrain competition in the ‘public interest,’” the brief states.
The FTC has argued that the State Action Doctrine does not shield the transaction because it contends the state of Georgia has not articulated intent to displace competition in the market for hospital services. It also has argued that relevant state law provisions do not suggest any legislative intent to displace competition in the provision of hospital services.
The FTC has opted not to comment on the amicus briefs as they are filed.
The case is set to be heard Nov. 26.