Kansas medical regulatory boards and the state Attorney General’s Office are examining whether a recent U.S. Supreme Court antitrust ruling will have any effects on the boards’ memberships.
In a Feb. 25 opinion related to a North Carolina dentistry board, the Supreme Court ruled 6-3 that if a “controlling number” of a board’s members are active participants in the industry it regulates, they could be sued as antitrust law violators if they aren’t being actively supervised by the state.
Erica Landsberg, who has taught antitrust law at the University of Kansas School of Law for nine years, said Kansas regulatory boards could be affected, but it would depend on how many active participants the board has, what the board statutes say and if the state provides active supervision.
The makeup and regularly territory for each Kansas regulatory board is different, Landsberg said, but anticompetitive practices — such as price fixing or exclusionary deals — must take place before antitrust immunity is an issue.
Regulatory boards have been immune from federal antitrust laws since a 1943 Supreme Court ruling, which said that if a state sanctions anticompetitive conduct, the state is immune from investigation and prosecution by the Federal Trade Commission.
In 1980, the Supreme Court held that in order for a state to be immune it “must clearly articulate a policy to regulate the particular commerce at issue, and must actively supervise,” Landsberg said.
In context of antitrust law, she said, that means active supervision of the anticompetitive practices.
Teeth whitening as dentistry?
In the recent case of North Carolina State Board of Dental Examiners v. Federal Trade Commission, the North Carolina dental board mainly consisted of practicing dentists who are charged with regulating dentistry in the state.
The board sent 47 cease-and-desist letters to non-dentists who were providing teeth whitening services, although the statute that created the board didn’t indicate the board could regulate teeth whitening as a part of “dentistry.”
The Supreme Court also found the state of North Carolina didn’t actively supervise the board, which made it subject to federal antitrust laws.
The Kansas Attorney General’s Office is reviewing the ruling, according to Jennifer Rapp, public information officer at the office.
A few Kansas medical regulatory boards, which license and regulate medical professionals within their industries, also will review the ruling this month.
The Kansas Dental Board plans an informational conversation on the topic at its Friday meeting that is open to the public.
During the meeting, board members will discuss the ruling and get their attorney’s point of view on the matter, said Lane Hemsley, executive director of the dental board.
Later in April, the Kansas State Board of Healing Arts also will review and analyze the decision, according to Kelli Stevens, general counsel for the healing arts board, which regulates the state’s doctors.
Diane Glynn, practice specialist at the Kansas State Board of Nursing, said her board plans to wait for the attorney general’s assessment and possible opinion, and may discuss it at an upcoming meeting.
Rapp said no one has formally requested an attorney general opinion on the matter.
Hemsley, who is also a state legislator, said he doesn’t think the Kansas Dental Board has much to worry about because of the ruling, but said that it will comply with any recommendations that come along.
“The KDB is not currently aware of any changes that might need to be made to its structure ([such as] active market participants) or that of any other state regulatory agency,” Hemsley said in an email.
The Kansas Dental Board is dissimilar from its North Carolina counterpart, Hemsley said, in that the Kansas governor appoints board members while the North Carolina board members are elected by their dental peers.
The governor also appoints members of other Kansas medical boards, as well as members of other types of regulatory boards across the state.
Members as regulators
Medical regulatory boards in Kansas typically have a voting majority of their membership working in the business they regulate.
According to its statutes, the nine-member state dental board is composed of six dentists, two dental hygienists and one public member. The board of healing arts has 15 members, 12 of whom are doctors. The other three are public members. The state board of nursing has 11 members, with eight nurses and three public members.
If the structure of Kansas’ regulatory boards comes into question, the Legislature will have to review those statutes, Hemsley said. He doesn’t believe the ruling has been brought to his colleagues’ attention yet. Legislators are on break but will return April 29 to wrap up the 2015 session.
While all three boards are appointed by the governor, subject to review according to the Kansas Judicial Review Act, and each has a board structure created by the Legislature, Landsberg isn’t sure if that would qualify as “active supervision.”
During the time that North Carolina’s dental board was cracking down on non-dentists providing teeth whitening services, Kansas was too.
Hemsley said to regulate teeth whitening, the Kansas Dental Board asked for an attorney general’s opinion — which was to seek legislative approval for a law that would bar non-licensed people, unless supervised by a doctor or obtaining a license, from providing teeth whitening services.
After the law was adopted in August 2009, Hemsley said the dental board successfully filed suit in Shawnee County District Court against One Hour Smile, a teeth whitening service.
Other medical regulatory boards also take this type of court action, according to Stevens, the lawyer for the Kansas State Board of Healing Arts.
While the Supreme Court’s decision was based upon the North Carolina cease-and-desist letters, the original opinion of the Federal Trade Commission said the North Carolina dental board wasn’t prohibited from investigating and prosecuting violations of the state’s Dental Practice Act, taking action against non-licensees and letting the defendant, licensed or not, know that the board is seeking court action, Stevens said.
She added that the Kansas State Board of Healing Arts does all of these things through its own legislation, the Healing Arts Act.