Member Login

Members Online

What's New

AADO Changes its Name to Union of American Eye Care Providers

AADO Hires Washington D.C. Anti-Trust Attorney David Balto, Esq.

Press Release

AADO Marketing Campaign to Begin




Putting Anti-Trust Issues and Concerns to Rest

The AADO is Working to Preserve and Restore Competition in Eye Care Delivery

Some people wonder if AADO's mission might violate anti-trust law, be prevented by anti-trust law, or how AADO can do anything meaningful without violating anti-trust law.

The AADO is fully committed to a highly pro-competitive mission and is vigorously opposed to the anti-competitive affects of burdensome third party rules and regulations. These onerous rules are stripping practices of their independence and their ability to compete and have a decidedly anti-competitive impact. Free, unfettered competition results in better eye care and lower costs to consumers. The concern over anti-trust law is more paranoia than fact or legitimate concern. Anti-trust law is complex, but it is not a blanket prohibition on all collective action, and it does not handcuff providers from doing things that protect and improve competition in the eye care marketplace. Any assertion that the AADO violates anti-trust reflects a lack of knowledge about or understanding of the topic. It bears repeating: the AADO mission is pro-competitive and, if successful, will lead to both lower prices, access to care, and ultimately to better quality eye care for consumers.


Specifically, the AADO intends to fight to allow all eye care providers to practice without the anti-competitive restraints placed upon them by third party plans, enabling them to operate, and compete, in a free market. Consumers benefit, for instance, when optometrists are permitted to obtain products and services from the vendors of their choice so they can negotiate with those suppliers for the best products and best prices, and can pass on the savings that buying groups can offer. When third party plans dictate from whom their providers must obtain services and materials, and what prices they must pay, it diminishes competition among providers, which does nothing but hurt consumers as those higher prices are passed on. In fact, some third party plans consider a provider to be in breach of their provider contract if they offer discounts beyond what their provider contracts permit. In the same way, eye care providers in competition with one another are motivated to provide better care and better value. Third party plans that impose "standardizing" rules create barriers to competition, ultimately leading to higher costs and lower quality of care.


It is clear that the onslaught of new restrictive rules being unilaterally placed on eye care providers by third party plans, vision care plans in particular, in addition to being self-serving for the plans, are also effectively removing all competition from the eye care provider marketplace. Each provider must obtain their products from the same sources, must carry the same frame lines, must offer the same discounts, and must accept the same reimbursements. The cumulative affect of these "standards" is to eliminate all areas in which eye care providers would normally compete with one another. Competition is the engine that drives quality up, and prices down. Consumers suffer when the providers of services and products do not compete with one another. That is the danger, the evil if you will, that anti-trust law is designed to prevent -- and it is being forced upon eye care providers by third party plans. AADO, in fighting for independence from these anti-competitive rules, is fighting to protect competition, and that is never an anti-trust violation. 

Established Law Supports Our Mission

The simple fact is, though anti-trust law has application and must be respected, significant legal precedence and case law define quite clearly what can and can not be accomplished. Legal precedence provides a group like AADO with a lot of room to advance and defend the interests of the profession in order to improve quality of care and lower prices or increase value to consumers. It may surprise some, including some in positions of power and influence in the profession, to learn that, for these very reasons, significant collective bargaining is permitted under anti-trust law. The Courts recognize the pro-competitive affects, and the positive impact on the quality of care, the comes from allowing providers some latitude in this arena. As it pertains to AADO, only price fixing and group boycotts are per se prohibited. The AADO will not engage in either, nor does it have to engage in either to be be an effective and powerful advocate for eye care consumers and the professions that serve them.


If you support the concept of the AADO, don't let the fear and ignorance of others, including some you may think should know, deter you from joining the only organization willing and able to take a stand against abusive 3rd party practices that are eliminating independence from providing eye care. It is the fear of anti-trust, and, frankly, an unfounded fear, that has, for decades, paralyzed our state and national organizations from defending the profession against the predatory practices of third party plans, and at the same time, that has given those same plans almost unfettered control over us. Ironically, the result has been nearly complete elimination of free market forces and competition in the profession. It's time to stop allowing the tail to wag the dog out of fear that anti-trust law prevents us from enforcing provider agreements and demanding fair treatment so that we can compete with each other, resulting in better care for our patients. 

International Healthcare v. Hawaii Coalition for Health, et al.

Perhaps the best guidance and unequivocal proof that we as optometrists can organize and defend ourselves against abusive third party practices comes from the powerful language found in the 2003 case of International Healthcare Management and Health Hawaii Network v. The Hawaii Coalition for Health; Hawaii Medical Association; and Queens Physician Group (2003) 332 F.3d 600. This case was decided by the 9th Circuit Court of Appeals (referred to below as IHM) and is the law-of-the-land for a large part of the Western United States. More importantly, it provides the blueprint for AADO's ability to defend optometry and improve care by restoring free competition among independent optometrists! (Click to read the full decision of this case.)


The plaintiffs in the IHM case were a managed care organization. The primary defendant, Hawaii Coalition for Health, was an organization just like AADO, a non-profit coalition of physicians (M.D.s). Their members constituted a substantial number of the physicians in Hawaii. The defendants, the Coalition, sought to negotiate terms of the provider contracts with the managed care organization. After they had little success getting the MCO to make any changes to the agreements the defendant Coalition issued an "Alert" to inform "members that their organizations had tried without success to enter a dialog with HHN about 'serious problems' with its provider agreement" and "that it might be wise for physicians to wait until these issues can be clarified and resolved before signing up as a participating provider with HHN." Plaintiff's contended that the defendant Coalition violated anti-trust law by joining forces to negotiate terms of a new participating provider agreement and by suggesting a boycott of the plan via the "alert."


In response, the 9th Circuit said, "As we observed in Alston, the arena in which healthcare providers deal with plans is a complex and evolving one that may in some circumstances justify collective action:

Medical plans serve, effectively, as the bargaining agents for large groups of consumers; they use the clout of their consumer base to drive down health care service fees. Uniform fee schedules-anathema in a normal, competitive market-are standard operating procedure when medical plans are involved. In light of these departures from a normal competitive market, individual health care providers are entitled to take some joint action (short of price fixing or a group boycott) to level the bargaining imbalance created by the plans and provide meaningful input into the setting of the fee schedules. Thus health care providers might pool cost data in justifying a request for an increased fee schedule. Providers might also band together to negotiate various other aspects of their relationship with the plans such as payment procedures, the type of documentation they must provide, the method of referring patients and the mechanism for adjusting disputes. Such concerted actions, which would not implicate the per se rule, must be carefully distinguished from efforts to dictate terms by explicit or implicit threats of mass withdrawals from the plans."

Later in the IHM decision the Court said, quite powerfully, "both the Coalition and the [Hawaii Medical Association] have an interest in informing their members of developments in managed health care, and their members have an interest in receiving that information. Disseminating information that fosters rational business decisions is pro-competitive."

The AADO Levels the Playing Field

Make no mistake about it, this is a complex area. But, as can be seen above, providers and doctors are NOT powerless to convey to plans their collective disagreement with provisions in the provider contracts, or the actions of the plans. Providers can fight to protect and restore competition in the eye care marketplace. There are lines that cannot be crossed, to be sure. But that doesn't mean health care providers have no say.


The AADO is the FIRST organization, and the ONLY organization, that has as it's purpose and mission the goal of challenging the plans, especially Vision Care Plans, and trying to level the bargaining imbalance. That, colleagues, is the AADO, and it can and will operate completely within the guidelines of established anti-trust law.