Antitrust implications of chiropractic Peer Review Committees

Peer Review Committees (PRCs) that aid insurance companies in evaluating chiropractic treatments and fees have been the focus of recent court challenges. Some practitioners have argued that PRC activities constitute price fixing in violation of the Sherman Antitrust Act. PRCs have been successful thus far in claiming an exemption from antitrust scrutiny as a "business of insurance" within the meaning of the McCarran-Ferguson Act. This Note contends that PRCs are not exempt from antitrust regulation; since PRCs do not spread risks and are involved in inter- rather than intra-industry agreements, their activities do not fall within the narrowly defined "business of insurance" exemption. The Note then analyzes the merits of the price fixing allegations under both the "per se" standard and the " rule of reason." First, the Note concludes that the unique nature of the health care market and the legitimate functions served by peer review make the application of a per se standard inappropriate. Second, under the rule of reason, the Note indicates that peer review encourages efficient and innovative health care practices while it deters the escalation of health care costs. The Note concludes that the net effect of peer review is not anticompetitive, especially since PRCs lack the coercive power to compel compliance with the recommendations.