A High Court action taken by the Competition Authority against the Irish Medical Organisation (IMO) for allegedly fixing the fees GPs charged life insurance companies for medical reports has been settled.
The action was settled yesterday and, as part of the settlement terms, the IMO agreed to pay the Competition Authority's costs, which are understood to be in excess of €60,000. But the IMO stressed last night that the settlement did not constitute an admission that it had breached the Competition Act.
In a short statement it said: "The Irish Medical Organisation has today agreed to settle High Court proceedings with the Competition Authority relating to private medical attendant reports. The settlement does not constitute an admission that the IMO was in breach of the Competition Act."
The Competition Authority's investigation began in February 2005 on foot of a complaint received during a fees dispute between the IMO and life insurance companies. It obtained a warrant from the District Court and in April 2005 the offices of the IMO on Fitzwilliam Place in Dublin were searched by Competition Authority officials. More than 340 items were removed including a computer hard drive. The following month the Competition Authority also searched the office of a GP.
Its investigation centred on two allegations - that the IMO was involved in price fixing in respect of medical reports to life assurance companies and that it had threatened to withdraw these services if the life assurance companies did not pay a proposed increase in fees.
Arising from its investigation, the authority initiated proceedings against the IMO in the High Court last July, claiming that the IMO's conduct had as its object the prevention, restriction or distortion of competition in the market for medical information provided to life insurance companies. The IMO disputed this.
But the sides have now reached a settlement - the IMO undertakes to refrain from issuing any communication to its members that would express an opinion on fees to be charged for services provided to life insurance companies by GPs. It also undertakes to refrain from directly or indirectly discouraging its members from individually negotiating with life insurance companies. And it has undertaken to refrain from issuing any communication to members instructing them to withhold services from life insurance companies.
Dr Stanley Wong, director of the monopolies division of the Competition Authority, said he was pleased with the outcome.
"The terms and subject matter of this settlement have much wider-reaching implications than simply affecting the cost of medical reports to insurance companies. It further demonstrates the continuing commitment of the Competition Authority to take enforcement action where appropriate against co-ordination by individual undertakings or their representative bodies with respect to price and other dimensions of competition in any sector of the Irish economy," he said.
The Competition Authority conducted an investigation in 2005 into how fees were negotiated between the Irish Hospital Consultants' Association (IHCA) on behalf of its members and private health insurers. It ruled the IHCA was in breach of the Competition Act. The IHCA, which denied it had breached the Act, reached a settlement with the authority and gave undertakings in relation to not negotiating fees for its members in future. That settlement was also reached without an admission of liability.