Arizona V. Maricopa County Medical Society

Arizona v. Maricopa County Medical Society is a landmark United States Supreme Court case that was decided on June 18, 1982. The case, officially cited as 457 U.S. 332 (1982), addressed the legality of a fixed fee schedule for medical services, which was established by the Maricopa County Medical Society in Arizona. This case is significant in the realm of antitrust law as it pertains to the healthcare industry, particularly regarding the application of the Sherman Antitrust Act to professional associations.

Background

The Maricopa County Medical Society, a professional association of physicians in Maricopa County, Arizona, had established a maximum fee schedule under a plan known as "Foundation for Medical Care" (FMC). Physicians who participated in the plan agreed not to charge more than the established fees for services provided to policyholders of specified insurance plans. The United States filed a lawsuit against the Maricopa County Medical Society, alleging that the fee agreement constituted price fixing and was therefore in violation of Section 1 of the Sherman Antitrust Act, which prohibits contracts, combinations, or conspiracies in restraint of trade or commerce.

Supreme Court Decision

The Supreme Court, in a 4-3 decision, held that the fixed fee schedule established by the Maricopa County Medical Society was indeed a violation of the Sherman Antitrust Act. Justice Sandra Day O'Connor, writing for the majority, argued that the fee agreement restricted competition among physicians and was not exempt from antitrust laws simply because it was established by a professional association. The Court rejected the argument that the fee schedule was necessary to achieve the benefits of cost control and quality of care, stating that such objectives must be pursued through competitive, not collusive, means.

Implications

The decision in Arizona v. Maricopa County Medical Society had significant implications for the healthcare industry and professional associations. It underscored the applicability of antitrust laws to the actions of professional organizations and set a precedent for evaluating similar arrangements in other sectors. The ruling emphasized the importance of competition in setting prices for services, even within the context of professional healthcare services, where the dynamics of market competition are complex.

See Also

• Sherman Antitrust Act
• Healthcare in the United States
• Antitrust law
• Professional association

References

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