DOJ Lawsuit Against OhioHealth Alleges Anticompetitive Contract Restrictions with Payors

In February 2026, the United States and the state of Ohio brought an antitrust action against Ohio hospital system OhioHealth alleging that the system’s contracts with commercial health insurers (payors) included restrictions that impeded the development and expansion of lower‑cost health insurance plans. The suit signals a renewed interest in challenging payor-provider contract restrictions that federal and state antitrust enforcers argue limit the availability of more cost‑effective options for patients.

On February 20, 2026, the US Department of Justice’s Antitrust Division and the Ohio Attorney General (collectively the government), filed a civil lawsuit against OhioHealth Corporation (OhioHealth) in the United States District Court for the Southern District of Ohio, alleging violations of Section 1 of the Sherman Act and Ohio’s antitrust law, the Valentine Act. In the lawsuit, the government alleges that OhioHealth, which owns or manages 16 hospitals and outpatient facilities throughout Ohio, used its market power in the Columbus area to force payors to accept contractual restrictions that made it difficult or impossible for the payors to develop “budget-conscious” health plans” for their insureds.

In particular, the complaint alleges that OhioHealth restricted payors’ use of several “tools” that could increase competition for healthcare services among competing providers and thus lower costs for patients. These alleged tools or health plan features include:

• Narrow Network Plans: Insurance plans built around networks with a limited set of cost-effective providers.
• Tiered Network Plans: Benefit designs that lower members’ out-of-pocket costs when they utilize designated, cost-effective providers within a network.
• Centers of Excellence: Programs that incentivize members to obtain certain healthcare services from designated groups of providers that offer better value within a broader network.
• Site of Service Steering: Incentives for patients to receive care in lower-cost clinical settings, such as ambulatory surgery centers.
• Reference-Based Pricing: Reimbursement structures that set fixed payment amounts for procedures, usually pegged to a reference point such as market average prices or a percentage of Medicare.
• Active Transparency: Payor outreach to members to share pricing information that informs the member’s choice of healthcare provider.

The government asserts that OhioHealth’s contractual restrictions inhibited the implementation of these “tools for creating budget-conscious plans.” This has allegedly harmed competition by: (1) restricting the development of lower cost plans centered around Ohio State University or Mount Carmel health systems; (2) reducing incentives for rival hospitals to offer discounted pricing because they are unlikely to get greater patient volume; (3) impeding entry and expansion by competing providers; and (4) depriving competitors of the patient volume needed to support additional investments in their facilities and services.

Notably, the government alleges that OhioHealth has market power sufficient to cause these anticompetitive effects despite having relatively modest market shares in the alleged relevant antitrust market (“more than 35%”). The government contends that OhioHealth is a “must have” system for payors seeking to offer competitive insurance products in the Columbus area. DOJ further alleges that OhioHealth derives additional market power from hospitals it operates outside Columbus, some of which are the sole hospitals in their counties and therefore critical for payors.

The government’s complaint against OhioHealth resembles DOJ and the North Carolina Attorney General’s 2016 lawsuit against Carolinas HealthCare System (now Atrium Health), which DOJ ultimately resolved through a negotiated settlement requiring modifications to Carolinas’ contracting practices. The settlement did not include a financial penalty or admission of wrongdoing, but prohibited Atrium from enforcing the alleged anticompetitive provisions, and allowed payors to provide consumers with transparent price, cost and quality information.

KEY TAKEAWAYS

• The DOJ’s action against OhioHealth signals a renewed interest in challenging contractual restrictions that may inhibit the development of “budget-conscious plans,” such as narrow and tiered network plans. Healthcare provider networks and hospital systems—particularly those with substantial market shares—should consider whether provisions in their contracts with payors could expose them to potential antitrust risk.
• OhioHealth’s relatively modest alleged market share may signal increased aggressiveness by the federal antitrust enforcers to challenge potentially anticompetitive conduct even in the absence of traditionally high market shares alleged in prior litigation. According to the DOJ, this action is consistent with the agency’s stated objective of tackling “kitchen table issues” that have a direct impact on the lives of everyday Americans.
• The DOJ’s suit increases the likelihood of private follow-on litigation against OhioHealth. Hospitals and health systems should be aware of the risk that government enforcement actions may prompt subsequent private antitrust suits based on the same conduct.

HOW WE CAN HELP

Morgan Lewis lawyers guide and provide strategic antitrust counseling in the healthcare industry, including for health systems facing challenges from federal or state antitrust enforcers.