Monday, October 20, 2014

Supreme Court Ruling in Federal Trade Commission Case Will Have Broad Implications for Scope of Practice Regulations

By Joanne Spetz, PhD

Last week, the U.S. Supreme Court heard arguments in North Carolina State Board of Dental Examiners v. Federal Trade Commission (FTC), a case that will have significant implications for scope of practice regulations across the country.   At the center of this case is the “state-action doctrine,” which provides immunity from federal antitrust liability for certain state-mandated activities. In this case, the FTC had filed a complaint regarding the Board’s efforts to stop non-dentists from offering teeth whitening services. The North Carolina Dental Board asserted state-action as a defense. The case centers on how the Board operates and whether its operations fall under the state-action doctrine. The FTC believes that the board, which is comprised mainly of practicing dentists, exceeded its authority and its actions were a private effort to eliminate competition from non-dentists – a violation of anti-trust law. The Board believes it is acting as a regulatory body to ensure consumer safety.

Last spring, the 4th Circuit Court of Appeals agreed with the FTC; the Board appealed to the Supreme Court. This case gives the Supreme Court an opportunity to decide whether health professions boards in general, which are usually established by state legislatures but whose members are private actors, fall under the state-action doctrine. If the Supreme Court sides with the FTC, it could have a significant impact on the capacity of dental, medical, nursing, and other boards to regulate health care services, especially when a compelling public safety argument cannot be made.  The Supreme Court’s decision also could provide clear guidance to states in how their boards can be appointed and function in order to adhere to anti-trust law. To follow the case’s history, look here

This same issue was addressed last June at an FTC public workshop in Washington, DC, titled, “Examining Health Care Competition. The workshop topics included professional regulation of health care providers, health care delivery innovations such as retail clinics, health information technology, health care quality, and price transparency. The meeting room was full for most of the two-day event, but attendance appeared greatest for the first session, “Professional Regulation of Health Care Providers,” for which I was one of the presenters. 

The session did not address any specific legal action related to health professions regulation, focusing instead on providing an overview of several important aspects of health professions regulation.  Barbara J. Safriet, JD, LLM, a Visiting Professor of Health Law and Lewis and Clark Law School, discussed the history of health professions regulation and the potential for legal collusion and hindrance of competition. Morris Kleiner, PhD, from the University of Minnesota, discussed health professions regulation in the context of professional regulation in general. He noted that health professions boards are often based at the same agencies as many other professions’ boards, so a single organization is charged with overseeing physicians, nurses, cosmetologists, pet groomers, and myriad other professions. Gail Finley of the Colorado Hospital Association discussed particular challenges that state faced regulating nurse anesthetists, and the battle between physicians and nurses regarding safe anesthesia care in rural communities. I discussed the impact of scope of practice regulations for licensed practical/vocational nurses on the demand by hospitals and nursing homes – we found that in states with stricter regulations, there is lower demand.

The FTC published a Policy Perspective paper in March 2014 on “Competition and the Regulation of Advanced Practice Nurses.”  The paper’s authors reviewed the rationale for establishing scope of practice regulations, noting that there are valid reasons to control scope of practice, even if it might reduce competition. However, they wrote: “…the FTC staff has consistently urged state legislators to avoid imposing restrictions on APRN scope of practice unless those restrictions are necessary to address well-founded patient safety concerns. Based on substantial evidence and experience, expert bodies have concluded that ARPNs are safe and effective as independent providers of many health care services within the scope of their training, licensure, certification, and current practice. Therefore, new or extended layers of mandatory physician supervision may not be justified.”

Unsurprisingly, there is great interest in the Supreme Court case throughout the health care industry. Among the entities that have filed amici briefs, are the American Dental Association, Federation of State Boards of Physical Therapy, American Association of Nurse Anesthetists, Association of Dental Support Organizations, Cato Institute, Pacific Legal Foundation, National Governors Association, California Optometric Association, and Public Citizen, and 23 states.  A decision is expected next year.

Joanne Spetz is a professor at the Philip R. Lee Institute for Health Policy Studies and associate director of research strategy for the Center for the Health Professions at the University of California, San Francisco.

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