The 10^th Circuit Court of Appeals has upheld a lower court decision in favor of Mercy Regional Medical Center allowing them to continue providing nephrology (kidney) services to the Durango community, despite monopolization charges from a New Mexico doctor.

Mercy Regional Medical Center has fought back and won in the 10^th Circuit Court of Appeals against charges of monopolization brought by Dr. Mark Bevan of Farmington, New Mexico.

Dr. Bevan claimed that Mercy was establishing an unlawful monopoly in the community by entering into an exclusive agreement with another kidney specialist in Durango, but the 10^th Circuit Court of Appeals rejected his claim stating that the hospital did not have an obligation or antitrust duty to share its practice with Dr. Bevan, “… at the expense of its own nephrology practice.”

With a high prevalence of kidney disease in the Durango area, Mercy Regional Medical Center tried for nearly a decade to persuade Dr. Bevan to provide services in Durango. With his refusal, Mercy and the Southern Ute Indian Tribe successfully recruited another kidney specialist, Dr. Mark Saddler, to move to town under an exclusive agreement in 2005. While they projected a revenue loss with the start-up of the practice, they recognized the critical need in the community, and Mercy and the tribe agreed to cover the losses of Dr. Saddler, provided he offer dialysis and kidney disease treatment in Durango.

Upon establishment of Dr. Saddler’s practice, Dr. Bevan reversed course and requested expanded medical staff privileges at the hospital for himself and four doctors from his Farmington practice. When that request was denied by Mercy, he filed a lawsuit citing federal and state anti-trust laws.

According to the court, Mercy’s view of prior events in Page, Arizona (though disputed by Dr. Bevan) gave Mercy good cause for concern: "… when a competing group of nephrologists opened a dialysis center in Page, about four hours west of Farmington, Dr. Bevan responded by opening his own dialysis center in Page. The town apparently couldn't support two competing clinics, however, and the competitor clinic soon closed. Shortly after that, Dr. Bevan closed his clinic in Page, leaving the town with no nephrology practice and many of its kidney dialysis patients once again with a four-hour trek to Farmington. In light of its understanding of this episode, the hospital worried that Dr. Bevan's true intentions were to destroy Durango's nephrology practice, rather than to increase the quality and quantity of nephrology services in Durango.

In addition, according to court documents, Dr. Bevan falsified information he provided to Mercy: “… Members of the hospital’s active staff were obliged by the bylaws to reside within 30 minutes of the hospital in order to provide emergency care…[Dr. Bevan] told Mercy that he had leased a residence near Durango, which, on investigation, turned out to be a plot of vacant land.”

"Given the history of Mercy’s dealings with Dr. Bevan, we are not surprised that the Court sided with Mercy Regional Medical Center," said Mark Sabey, the health care attorney in Kutak Rock LLP's Denver office representing Mercy in the case. “Mercy’s aim has always been to put the community first and provide high quality and convenient medical services to those who need dialysis and kidney disease services in Durango.”

The 10th Circuit concluded that Mercy's refusal to deal with Dr. Bevan does not constitute anti-competitive conduct under state or federal antitrust laws and that Dr. Bevan has not suffered an antitrust injury. The court stated: "Having made a substantial investment in developing its own nephrology practice, ... Mercy is entitled to recoup its investment without sharing its facilities with a competitor." This ruling could significantly impact the ongoing debate over economic credentialing in hospitals.