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Wisconsin Chiropractors Settle FTC Charges

The Wisconsin Chiropractic Association (WCA) and its executive director, Russell A. Leonard, have agreed to settle Federal Trade Commission allegations that they orchestrated a conspiracy among WCA members to increase prices for chiropractic services and to boycott third-party payers to obtain higher reimbursement rates. The result, the FTC said, was higher prices for consumers of chiropractic services. The proposed settlement would prohibit the WCA and Leonard from fixing prices for any chiropractic goods or services, or the terms of third-party payer contracts.

Additionally, Michael T. Berkley, D.C., and Mark A. Cassellius, D.C., have agreed to settle Federal Trade Commission allegations that they conspired to fix prices for chiropractic services and to boycott the Gundersen Lutheran Health Plan (Gundersen) to obtain higher reimbursement for chiropractic services in and around La Crosse, Wisconsin. The proposed settlement of these charges would prohibit Drs. Berkley and Cassellius from fixing prices for any chiropractic goods or services, and from orchestrating concerted refusals to deal.

Wisconsin Chiropractic Association

The Wisconsin Chiropractic Association, based in Madison, is an association of more than 900 Wisconsin chiropractors, representing about 90 percent of the chiropractors licensed in the state. Professional services performed by chiropractors include manual therapy of the spinal and extra-spinal regions to improve joint and neurophysiological function.

In January 1997, the federal government and many private insurance companies began using new billing codes for chiropractic manipulations. According to the FTC's complaint, the WCA and Leonard used the implementation of the new codes as a vehicle for orchestrating a collective price increase by Wisconsin chiropractors. The WCA and Leonard organized and conducted seminars on the new codes throughout the State of Wisconsin, at which, among other things, Leonard advised chiropractors to raise their prices to specific levels, and assured members that if they all raised their rates, third-party payers would not reject or reduce these higher charges for the new codes. Leonard also surveyed member pricing in certain localities, and reported back to members that chiropractors in these areas had succeeded in raising reimbursement levels, the FTC stated.

The complaint further charges that the WCA, again acting principally through its executive director, engaged in other acts and practices in furtherance of its goal of increasing compensation for chiropractors in the state. In particular, the WCA: circulated fee surveys to facilitate coordinated pricing by its members; urged chiropractors to negotiate higher fees with the plans and advised members to discuss contract offers with one another to improve their bargaining position with third-party payers; and encouraged and assisted in boycotts of two managed care plans to obtain higher reimbursement rates for chiropractic services.

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