DOJ Alerts Heightened Scrutiny on Data Exchanges and Competitor Collaborations


On February 3, 2023, the US Division of Justice’s (DOJ) Antitrust Division announced the withdrawal of three coverage statements associated to antitrust enforcement in healthcare. Though the withdrawn statements give attention to healthcare, DOJ’s resolution to withdraw these statements could have broad impacts throughout industries.

The three coverage statements, issued in 19931996, and 2011, relate to competitor collaboration and knowledge sharing, and established “security zones” of actions shielded from antitrust scrutiny. The 1996 Statements of Antitrust Enforcement in Well being Care (1996 Statements) have been revised and expanded upon the 1993 Statements. Although ostensibly associated to healthcare, the steerage has been relied upon by all industries and understood to cowl all method of competitively delicate info. Two of the protection zones most frequently relied on by corporations relate to competitor exchanges of value and value info, and competitor joint buying preparations.

Data Exchanges

The protection zone on info exchanges (Assertion 6 of the 1996 Statements) said that, on the whole, the companies wouldn’t problem an trade of value or price info (e.g., worker compensation) if the next three circumstances have been met:

  1. The trade is managed by a 3rd occasion (e.g., a commerce affiliation or advisor).
  2. The data is greater than three months previous.
  3. The trade has 5 or extra individuals contributing information, and no particular person participant’s information represents greater than 25% of any statistic; and no particular person participant’s information will be recognized.

Corporations have relied on this security zone in conducting surveys and benchmarking associated to pricing, provide prices, and salaries. These surveys have served as essential compliance instruments. Organizations exempt from federal revenue tax typically use surveys to display truthful market worth compensation to safeguard towards claims of personal inurement and personal profit. Equally, healthcare corporations routinely use benchmarking research to display truthful market worth compensation for compliance with fraud and abuse legal guidelines.

Group Buying Organizations

The protection zone on joint buying preparations (Assertion 7 of the 1996 Statements) said that, on the whole, the companies wouldn’t problem joint buying preparations (e.g., group buying organizations (GPOs)) if the next two circumstances have been met:

  1. The purchases account for lower than 35% of the whole gross sales of the bought services or products.
  2. The price of the services or products bought collectively accounts for lower than 20% of the individuals’ revenues.

DOJ cited adjustments within the healthcare panorama because the rationale for withdrawing these coverage statements, particularly indicating that the statements have been “overly permissive” on info sharing. In a speech the day earlier than DOJ’s announcement, Principal Deputy Assistant Legal professional Normal (DAAG) Doha Mekki said that the protection zone components “don’t take into account the realities of a remodeled trade” and “understate the antitrust dangers of rivals sharing competitively delicate info.” DAAG Mekki defined that:

  • Data exchanges managed by third events can have the identical anticompetitive results—and the usage of a 3rd occasion enhances anticompetitive results.
  • New algorithms and AI studying enhance the aggressive worth of historic info (greater than three months previous) for sure services and products.
  • 5 or extra individuals don’t assure that such an info trade is not going to hurt competitors, particularly when the individuals exchanging the data collectively have a big share within the related market.

Thus, based on DAAG Mekki, “sustaining the protection zones can be like creating specs for audio cassette tapes and making use of them to digital streaming.” DOJ is anxious that technological advances could permit corporations and third-party entities better capabilities to reverse engineer sure varieties of knowledge in ways in which facilitate coordination (e.g., utilizing AI studying or advanced algorithms to foretell particular person individuals’ future habits primarily based on historic information, or disaggregate or unblind a person participant’s information).


Statements 8 and 9 of the 1996 Statements addressed doctor community joint ventures and multiprovider networks, generally generally known as impartial apply associations (IPAs) and clinically built-in networks (CINs). These statements set forth broadly adopted ideas of considerable monetary danger sharing and medical integration applications that, the place enough, served as a foundation for competing suppliers to collectively contract with payors beneath the extra favorable rule of purpose normal of evaluate. The 2011 Assertion of Antitrust Enforcement Coverage Relating to Accountable Care Organizations Taking part within the Medicare Shared Financial savings Program (2011 ACO Assertion) supplied that accountable care organizations (ACOs) collaborating within the Medicare Shared Financial savings Program (MSSP) can be afforded rule of purpose remedy if, within the industrial market, the ACO used the identical governance and management construction and medical and administrative processes as for MSSP participation. This was a major profit to hybrid ACOs/CINs, because it eradicated the chance of business actions being handled as a per se illegal price-fixing or market allocation agreements amongst rivals. In consequence, many well being programs and doctor teams relied on the 2011 ACO Assertion. This assurance not exists.


The coverage statements and the protection zones by no means had the drive of legislation, however their withdrawal results in better uncertainty for corporations concerned in info exchanges and different competitor collaborations. Corporations routinely depend on third-party research of historic information from a number of market individuals to guage how you can value their services and products and guarantee they’re setting aggressive costs, paying aggressive costs for inputs and provides, and providing aggressive compensation and advantages to their workers. The withdrawal of the statements removes clear steerage on how to do that lawfully. Corporations can be smart to evaluate their current info exchanges, with an emphasis on making certain that participation in info exchanges doesn’t facilitate coordination as a result of the data being exchanged will be disaggregated or unblinded to establish particular individuals’ information. The companies are more and more targeted on competitors points associated to worker compensation and hiring (see the Federal Commerce Fee’s (FTC) proposed rule banning noncompete agreements, mentioned right here).

Regardless of DOJ’s motion, corporations can nonetheless trade info—even with rivals. DOJ, nevertheless, is searching for to insert uncertainty round what sorts of exchanges are all the time affordable. Our view is that going ahead corporations ought to observe the FTC’s 2014 recommendation shared in a weblog publish that suggested: “let purpose be your information.” That weblog cited the FTC and DOJ’s 2000 Antitrust Tips for Collaborations Amongst Rivals—which haven’t been withdrawn—which defined that reasonableness “is dependent upon the character of knowledge” shared:

  • The sharing of knowledge on value, output, prices, or strategic plans is extra more likely to elevate aggressive issues than the sharing of much less delicate info.
  • The sharing of knowledge on present and future plans is extra more likely to elevate aggressive issues than the sharing of historic info.
  • The sharing of particular person firm information is extra more likely to elevate concern than the sharing of aggregated information that does establish particular person corporations.

In our view, the trail ahead is to make use of the withdrawn “security zones” as a place to begin for assessing whether or not the information-sharing protocols are affordable in gentle of potential authorities issues. Corporations, subsequently, with the help of antitrust counsel, ought to take time to reassess their information-sharing protocols to contemplate the reasonableness of these protocols contemplating the character of the data shared and the enterprise goal of that association. Heightened focus ought to be given to the usage of info shared or obtained and the way it would possibly influence pricing or compensation selections.