Monopolies, Self-Referral and Shell Games: The Need for Antitrust Investigation of Physician Health Programs and their “PHP-Approved” Assessment and Treatment Centers

Screen Shot 2015-03-06 at 4.38.05 AMThree shells and a pea–ASAM, FSPHP, and LMD.

“PHP-Approved” Assessment and Treatment Centers

On the above list  can be found the Medical Directors of a number of drug and alcohol rehabilitation facilities.

Talbott, Marworth, Hazelden, Promises, and another two-dozen or so “PHP-approved”  assessment and treatment centers are represented on this list.    State Physician Health Programs (PHPs) refer doctors to these facilities for evaluations.  PHPs are non-profit tax-exempt organizations.  They do not evaluate or treat patients.   If a physician is referred to a PHP for a suspected problem the assessment must be done at an outside facility which will invariably be linked to a name on the list of Like-Minded Docs.

What most people do not know, however, is that this is an exclusive arrangement.    Evaluations are constrained to one of these facilities.   It is mandated.   No bargaining.  No compromises. No choice.  In other words it is a coercion.

“What’s wrong with that?” one might ask.   These facilities are all recognized as top-drawer and first-class.  Perhaps they were hand-picked on objective criteria and the PHPs are just making sure that doctors get the best assessments money can buy– decision making by experts based on knowledge and experience–picking a winner so you don’t have to.

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No documented Policy for Selecting Treatment Centers.  Criteria for “PHP-Approval” Unknown by those “Approving”

What objective criteria are used in selecting “PHP-approved” assessment and treatment centers?    According to a  Performance Audit of the North Carolina Physicians Health Program done by State Auditor Beth A. Wood that’s a good question.

The North Carolina State  Audit specifically noted the predominant use of out-of-state treatment centers.   In addition to “creating an undue burden on” those being evaluated the audit states that:

 “Program procedures did not ensure that physicians received quality evaluations and treatment because the Program had no documented criteria for selecting treatment centers and did not adequately monitor them”

In fact the audit found no documented policy for selecting treatment centers.  The very organizations demanding documentation of policy for approval and charged with approving the treatment centers could not even give a comprehensible, plausible or even simple explanation for what any of  these things even mean.    

Screen Shot 2014-05-07 at 5.38.23 PMThe auditor also noted this lack of concrete criteria goes against both The Federation of State Physician Health Programs (FSPHP) and the Federation of State Medical Boards (FSMB) requirements that physician health programs use established guidelines to select evaluation providers and treatment centers.

In its “Physician Health Program Guidelines,” the FSPHP established: • “Characteristics of Evaluation Providers Appropriate for PHP referrals,” and • “Characteristics of Treatment Programs which are appropriate for PHP referrals.”  And in its “Policy on Physician Impairment,” the FSMB states : • “PHPs should employ FSPHP Guidelines in selecting the providers/facilities to provide treatment of physicians with addictive and/or psychiatric illness.”

When the NC PHP was asked to define these characteristics they explained that they learned  of “new treatment centers through professional networks and other informal sources” and used the “treatment centers’ reputation as a basis for establishing a referral relationship.”      Staff credentials, quality of care, treatment methods and modalities, patient choice, follow-up data, outcomes and other objective information apparently took a back-seat to what appears to be ill-defined and subjective word-on-the-street.   Screen Shot 2014-03-15 at 7.33.14 PM

This  “failure to use FSPHP  recommended criteria to select treatment centers,” the Audit concluded “could cause the Program to enter into referral arrangements with service providers that do not meet quality standards”

Ironically the  NC PHP failed to follow guidelines they themselves introduced and demanded be followed.  They could produce no documentary evidence these criteria even exist or even provide plausible criteria.   “Professional networks”, “reputation” and other informal sources are fine for some choices.  That’s how I picked out my first skateboard.

Resources such as these can play in important role in choosing a shirt, buying new sneakers or even purchasing a car but they do not constitute selection criteria for an assessment in which the consequences and recommendations made for the person being assessed are significant, potentially life-altering and possibly permanent!

And to top it all off the  Medical Director of the North Carolina PHP,  Dr. Warren Pendergast,  was the  President of the national organization for state PHPs, the Federation of State Physician Health Programs (FSPHP) at the time of the audit!

PHPs are not clinical providers but monitoring agencies.  They meet with, assess and refer doctors for evaluations and then monitor doctors through drug and alcohol testing and periodic reports of supervisors, co-workers and others.        As such the PHP is tasked with just two jobs-referring doctors for evaluation and then monitoring them after they have been evaluated in a contractual agreement.  The fact that the state PHP 0r FSPHP could not produce the facts and reasoning  behind the mechanics and mentality of the very reason for which they exist is incomprehensible.  It is, in fact, ludicrous beyond belief.    The President of the FSPHP being unable to define the selection criteria for approved and mandated facilities is like Anthony Bourdain being unable to explain the ingredients of an omelette.

To summarize, doctors in North Carolina were being forced by the PHP  to have evaluations at “PHP-approved” assessment and treatment centers but the PHP was unable to explain anything substantive in defining any of it.  Why?  Because no qualitative objective selection criteria exist.

“Reputation” obfuscates and confuses.  It does nothing to support or justify.    It is like answering “numbers” to the question “what is 9 x 9?”

And this is especially concerning when it is realized that these evaluations are limited to facilities and people  tied financially and ideologically to the groups and individuals who are mandating the referral.

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All of the “PHP-approved” assessment centers are represented by medical directors who belong to “Like-minded docs”-an admittedly  12-step steeped conservative fundamentalist faction of the American Society of Addiction Medicine (ASAM).   And all of these facilities are private-pay rehabilitation centers that recommend doctors be treated three-times longer than the rest of the population–another medical “urban legend” that should have been debunked from the get-go.

Limiting assessment and recommendations to this close-knit  group of evaluators is a monopoly of force.  It is unethical if not criminal. And the fact that these are all heavily indoctrinated 12-step facilities also makes it a violation of the Establishment Clause of the 1st Amendment.  Moreover,  many of the medical directors at these facilities are also graduates of the same program in “recovery.”

And if it is looked at from this vantage point it is a system of  self-referral.  Self-referral harms patients and society as a whole.

It is a shell game that removes all choice and removes freedom, objectivity, fundamental fairness, autonomy and choice.


Antitrust law

American antitrust law was “designed to be a comprehensive charter of economic liberty aimed at preserving  free and unfettered competition as the mule of trade. It rests on the premise that the unrestrained interaction of competitive forces will yield the best allocation of our economic resources, the lowest prices, the highest quality and the greatest material progress, while at the same time providing an environment conducive to the preservation of our democratic political and social institutions” (29, p 4).

In this case it is a safe assumption that all doctors desire the “best possible” care and this requires objective and unbiased assessment and treatment when requested by Physician Health Programs.

Congress and the Supreme Court have made clear is that the “best” services are selected by  consumers when their choice is made in an open market free of restraints. Eventually the marketplace will determine the best medical care, not judges, juries, or even doctors (30, p 904).

PHPs are clearly bypassing patient choice.  In 2011 the American Society of Addiction Medicine (ASAM) issued a Public Policy Statement on coordination between PHPs, regulatory agencies, and treatment providers recommending  that  only “PHP approved” treatment centers be used in the assessment and treatment of doctors.  The state Medical Boards have accepted and adopted this policy and denying doctors requests for assessments at non “PHP-approved” facilities. Many have been sanctioned for resisting, protesting or even questioning this unlawful monopoly.  It is prohibition of patient choice.

The N.C. PHP is representative of most PHPs. This is not an exception but a rule.      PHPs are mandating assessments only at facilities they approve but cannot define or explain how these facilities are “approved”  Yet The ideological and financial conflicts of interest between the PHPs and their referral centers are self-evident.  Connect the dots.  

State medical boards are enforcing this mandate under threat of loss of licensure.   Your money or your life.

Federal Trade Commission

For these reasons an investigation by the Federal Trade Commission and Office of the Inspector General of the DHHS is necessary.  For those who have been abused by this unholy alliance I urge you to look at this list to see if the medical director of the facility at which you were evaluated is represented.

If so note it here.   My guess is almost everyone will find this correlation and representation in numbers would necessitate both state and Federal investigation.  If this were done it  could quickly transform a system of institutional injustice into one that allows choice.

Applying Antitrust law to the linkage of  PHPs  and “PHP approved” assessment and treatment centers is consistent with free-market law and theory.   Demanding accountability would provide a powerful deterrent to this type of unfettered abuse.

1. Northern Pacific Railway v U.S., 356 US I (1958).

.2.  Koefoot v American College of Surgeons. 652 F Supp 882 (ND Ill 1986).

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15 thoughts on “Monopolies, Self-Referral and Shell Games: The Need for Antitrust Investigation of Physician Health Programs and their “PHP-Approved” Assessment and Treatment Centers

  1. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  2. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  3. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  4. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  5. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  6. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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  7. […] in the drug-testing process are also on the list of LMDs.   It is a rigged system and explained  here.    Choice in assessment and treatment is removed and the “PHP-approved” facilities […]

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