The Federal Trade Commission (FTC) is principally and legally authorized to protect consumers from any form of exploitation regarding all sectors of the economy. The conception behind its operation is to ensure that a high degree of ethics is adhered to concerning pricing, quality and the health standards of the services.
In focus of the article, the FTC order outlines the key areas of breach of law hence the necessary intervention. Southwest Health Alliances through a joint price negotiation decided to fix the prices that all the concerned member doctors will be required to charge insurers. It is this agreement that resulted to hiking of prices beyond the reach of many consumers and businesses hence unethical in accordance with the laid standards. According to the FTC, the Southwest health being independent practice association and composed of multiple physicians decided to terminate competition through an integration of the medical terms involving pricing and conditions of work. As a contracting agency, the fact that competition was eliminated placed all the physicians on an equivalent scale of pay hence reducing the choice that the consumers would have regarding seeking health services. The act itself was wrong and illegal. Furthermore, the doctors themselves had no such integration idea making it less beneficial; to the consumers of services. It implies that the motive of the integration was to exploit consumers and not to consider the beneficial efficiency of the services.
In settling the order raised by the FTC, the proposition was aimed at terminating the anticompetitive conduct and allowing the Southwest health alliance to proceed in the execution of legitimate joint conduct. Furthermore, it took a strong stand in stopping the organization from facilitating sharing of agreement among physicians about the charges for insurers and the condition of service. The motive behind such undertaking was to open up the health services to the consumers in a manner that they could be able to negotiate with different physicians at different capacities and terms so as to lower the rates and enhance access to health services.
At a different capacity, the Federal Trade Commission opted to foresee the activities of the Southwest health to ensure the compliance with the law and the existing trading ethics so as to prevent future involvement in unlawful acts. Furthermore, the insurers that had previously signed an agreement since the year 2000 were to be protected by the commission and allowed to terminate the contracts without any penalty involved in the process. The fundamental motive of the entire work of the commission was to secure the insurers and customers against the exploitation and to signal such cases to other related firms that had or might have been involved in the situation.
Notably, the Southwest Healthcare Alliance is just a business like any other dealing with contracting services especially between physicians with the consumers of the services and the insurers. In their operation, they are bound to utilize the health plan in meeting their business objective. As a health motivated enterprise, they strategized to reduce competition and maximize their profitability to the extent that infringed the rights of the consumers and business hence declared unlawful. The business idea itself was and is lawful, but the implications of the strategy to the user were unethical, for this reason, the organization should have performed the following in meeting its objective following the required guidelines.
First, the organization was to assess the implication of their strategy in dominating the market before execution of the strategic plan. Healthcare is at the heart of every economy and therefore, all the concerns of the public regarding it are considered urgent and settled on the spot. In case the organization would have conducted an accurate assessment relating to the implications on pricing and access, some adverse effects would have been avoided.
Secondly, the group should have acted by the FTC requirements. All organization regardless of the area of specialization are bound to operate by the law and therefore, Southwest health agency should have done the same. Logically, before an organization is started, it must meet the requirement and even during the operation, none of the policies should be adjusted unless otherwise.
Thirdly, even though as an enterprise they were motivated to increase profitability through elevating charges, efficiency in service delivery should have been adhered to. Implying that the doctors should have at least acknowledge the integration hence identifying themselves with the terms and conditions of service. At a different capacity, the institution should have acknowledged the effort that the government is putting towards ensuring access to medical services and perhaps this would have influenced their decision regarding pricing and struggle in controlling the medical terms.
In conclusion, the FTC acts on issues upon acquisition of enough evidence showing the breach of law and a certain degree of exploitation of the consumers and businesses. Furthermore, it provides the guidelines to which must be adhered to with an ultimate goal of protecting the public and ensuring fairness, quality, and adherence to health standards. The Southwest health organization, therefore, should have acted by the policies and interest of the public.
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