''Arizona v. Maricopa County Medical Society'', 457 U.S. 332 (1982), was a

U.S. Supreme Court The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all U.S. federal court cases, and over state court cases that involve a point o ...

case involving

antitrust law Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust ...

. A society of doctors in

Maricopa County, Arizona Maricopa County is in the south-central part of the U.S. state of Arizona. As of the 2020 United States census, 2020 census, the population was 4,420,568, making it the state's most populous county, and List of the most populous counties in the ...

, established maximum fees that their members could claim for seeing patients who were covered by certain health insurance plans. Arizona charged them with violations of state

regarding

price fixing Price fixing is an anticompetitive agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given ...

. The society tried to rebut the state's charges by claiming that the maximum-fee arrangement was necessary to allow doctors to see these patients, and therefore generated economic benefits. On appeal, the Supreme Court rejected this defense, saying that price fixing was not truly necessary here: the society could have used insurance to pool their risk. The society's efficiency justification was either a pretext, or else could have been done through less restrictive means. The Court held that their justifications failed as a matter of fact.

Facts

Maricopa County Medical Society, by agreement of their member doctors, established the maximum fees the doctors may claim in full payment for health services provided to policyholders of specified insurance plans.

Arizona Arizona ( ; nv, Hoozdo Hahoodzo ; ood, Alĭ ṣonak ) is a state in the Southwestern United States. It is the 6th largest and the 14th most populous of the 50 states. Its capital and largest city is Phoenix. Arizona is part of the Fou ...

filed a complaint against MCMS in

Federal District Court The United States district courts are the trial courts of the U.S. federal judiciary. There is one district court for each federal judicial district, which each cover one U.S. state or, in some cases, a portion of a state. Each district cou ...

, alleging that they were engaged in an illegal

price-fixing Price fixing is an anticompetitive agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given ...

conspiracy in violation of the

Sherman Antitrust Act The Sherman Antitrust Act of 1890 (, ) is a United States antitrust law which prescribes the rule of free competition among those engaged in commerce. It was passed by Congress and is named for Senator John Sherman, its principal author. ...

Judgment

In a 4–3 decision, the court held that the maximum fee agreements, as price-fixing agreements, are ''

per se Per se may refer to: * '' per se'', a Latin phrase meaning "by itself" or "in itself". * Illegal ''per se'', the legal usage in criminal and antitrust law * Negligence ''per se'', legal use in tort law * Per Se (restaurant), a New York City restaur ...

'' unlawful under § 1 of the Sherman Act.

Significance

The ruling stipulates not just that maximum price fixing among competitors is unlawful, but that it is unlawful per se. This precludes any significant inquiry into potential procompetitive justifications for such an arrangement. According to one author, the result of the decision was to make "antitrust analysis once again confused and haphazard.".

Notes

References

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