AMA May Sue Over Medical Price Controls

A legal analysis by the American Medical Assn. contends that some price controls on private medical spending are unconstitutional, and officials raised the possibility Monday of suing the Clinton Administration if its health care plan contains such curbs.

“If our case is strong enough, yes, we would take legal action,” said Thomas Reardon, a member of the AMA board of trustees.

Administration officials have said they are considering short-term price controls, possibly voluntary, to combat medical cost inflation. White House health advisers repeatedly have said the plan would include a national health-spending limit on a state-by-state basis.

The AMA’s legal analysis concluded that “the government does not have unlimited discretion” in setting prices and that the courts’ interpretation of the Fifth Amendment requires that prices be at a level that would permit any enterprise to operate successfully and provide “a return on investment commensurate with the risk of the enterprise.”