eir emphasis in this paper. The reviews of each of these interest areas are summarized in the following discussions.
A PSN is comprised of qualified and licensed physicians. That these physicians required licenses to practice medicine is understood by all. Depending upon the areas of specialization of a PSN, the physician members of the organization also must be certified by the appropriate medical specialty board or organization. Further, a PSN must obtain an ordinary business license to operate in a given city or county. Licenses of these types, while important and necessary, also are routine.
The area of licensing that is crucial for PPOs of all kinds involves antitrust law. Quite simply, antitrust law is intended to prevent unfair competition in any field of economic activity. One of the key aspects of unfair competition is price-fixing by those organizations participating in a market. PSNs run the risk of being charged with price-fixing, and thus being denied the right to operate, because of the way in which fees are set and collected under the managed care concept.
The (Licensure( sub-section in this paper examines in some detail the problems that must be overcome by a PSN in order to assure that the federal Department of Justice and the Fair Trade Commission will not charge the organization with price-fixing, thereby denying the PSN to authorization to operate. Managed care organizations typically depend upon some form of capitation scheme for price setting and fee collection. The (Licensure( sub-section of this paper describes the things that a PSN must do during the organization phase to avoid antitrust charges related to fee-setting and collection based on the capitation concept. It also examines the relevant laws on the subject of licensure and the way the issue of licensure must be considered when a PSN first organizes and as it continues to operate thereafter.
Health Care Services Distribution...