For years, OhioHealth — the dominant hospital system in Columbus and central Ohio — required health insurers to include all of its hospitals in their networks or none of them. Insurers who wanted to cover OhioHealth’s flagship Riverside Methodist Hospital had to cover every OhioHealth facility, at OhioHealth’s prices. Lower-cost tiered plans that might steer patients to cheaper alternatives were effectively blocked.
The Department of Justice and the Ohio Attorney General announced Thursday that OhioHealth has agreed to settle federal antitrust allegations stemming from those contracting practices. Under the settlement, OhioHealth is prohibited from using all-or-nothing contract requirements with insurers. A compliance monitor will oversee the system for five years. There is no financial penalty and no admission of wrongdoing.
The DOJ’s complaint alleged that OhioHealth’s contracting practices suppressed competition in the Columbus metropolitan area by preventing insurers from designing benefit plans that might direct patients to lower-cost providers. When insurers can’t build tiered or narrow networks, patients lose the ability to choose plans that reward them for using cost-effective care. The practical effect: OhioHealth maintained pricing power that would have eroded in a more competitive market…