                IN THE SUPREME COURT OF IOWA
                             No. 10–0010

                          Filed July 27, 2012


STEVEN A. MUELLER, BRADLEY J. BROWN, MARK A. KRUSE,
KEVIN D. MILLER, and LARRY E. PHIPPS, on Behalf of Themselves
and Those Like Situated,

      Appellants,

vs.

WELLMARK, INC. d/b/a WELLMARK BLUE CROSS AND BLUE
SHIELD OF IOWA, An Iowa Corporation; and WELLMARK HEALTH
PLAN OF IOWA, INC., An Iowa Corporation,

      Appellees.



      Appeal from the Iowa District Court for Polk County, Eliza J.

Ovrom, Judge.



      Plaintiffs appeal the dismissal of claims alleging defendants

engaged in unlawfully discriminatory and anticompetitive conduct

against chiropractors in violation of insurance statutes and the Iowa

Competition Law.    AFFIRMED IN PART, REVERSED IN PART, AND

REMANDED.



      Glenn L. Norris of Hawkins & Norris, P.C., Des Moines; Steven P.

Wandro of Wandro, Baer & McCarthy, P.C., Des Moines; and Harley C.

Erbe of Erbe Law Firm, Des Moines, for appellants.



      Hayward L. Draper, Thomas H. Walton, and Patrick B. White of

Nyemaster Goode, PC, Des Moines, for appellees.
                                          2

WATERMAN, Justice.

       In this complex interlocutory appeal from a putative class action,

we must decide whether the district court correctly granted several

dispositive motions. Plaintiffs are doctors of chiropractic who allege they

have been victimized by the discriminatory practices of Iowa’s largest

health insurer, Wellmark, Inc. 1 The plaintiffs claim Wellmark wrongfully

imposes restrictions and pays lower rates for chiropractic services than

for equivalent services offered by medical doctors or osteopathic

physicians. Plaintiffs allege that Wellmark not only has violated various

insurance regulatory statutes, but also has engaged in unlawful

conspiracy and monopolization in violation of the Iowa Competition Law.

       First, the district court granted Wellmark’s motion to dismiss

claims brought under Iowa’s insurance regulatory statutes because no

private cause of action is provided therein. We affirm that ruling based

on Seeman v. Liberty Mutual Insurance Co., 322 N.W.2d 35, 42–43 (Iowa

1982). The proper forum for raising alleged violations of those regulatory

statutes is through administrative proceedings in the Iowa Division of

Insurance.

       Second, the district court granted Wellmark’s motion for summary

judgment on plaintiffs’ antitrust claims based on the “state action”

exemption found in Iowa Code section 553.6(4) (2009).                We reverse in

part because the summary judgment record fails to establish the

challenged conduct falls within the exemption.




       1Plaintiffs
                 filed suit against Wellmark, Inc. d/b/a Wellmark Blue Cross and Blue
Shield of Iowa and Wellmark Health Plan of Iowa, Inc., which is the Health Maintenance
Organization of Wellmark, Inc. The defendants will be collectively referred to as
Wellmark.
                                               3

        Third, the district court granted summary judgment on claims

alleging Wellmark breached its obligations under a judicially approved

national class action settlement in Love v. Blue Cross Blue Shield Ass’n,

No. 03–21296–CIV (S.D. Fla. Apr. 19, 2008).                     We affirm because the

record contains no evidence Wellmark’s implementation of the Love

settlement violated the Iowa Competition Law.

        Fourth, we affirm summary judgment on several specific antitrust

claims for reasons explained below. We remand the remaining claims

and defenses for further proceedings.

        I. Background Facts and Proceedings.

        This litigation began in December 2007 when Steven A. Mueller,

D.C., filed a breach-of-contract claim against Wellmark over a $17,376

billing dispute. On May 20, 2008, plaintiffs filed a first amended petition

adding plaintiffs, Bradley J. Brown, D.C.; Mark A. Kruse, D.C.; Kevin D.

Miller, D.C.; and Larry E. Phipps, D.C.                      Plaintiffs are doctors of

chiropractic who have billed for services provided to patients enrolled in

Wellmark health insurance plans.                   Their amended pleading asserted

class action claims on behalf of a putative “class of Iowa-licensed doctors

of chiropractic who are citizens of the State of Iowa as of the date of

filing.” 2      Plaintiffs sought damages and injunctive relief against

        2The   chiropractic profession has special significance to this state:
               Chiropractic was founded in Iowa in 1895 by D.D. Palmer, a
        Canadian immigrant. Palmer was a practitioner of magnetic healing; he
        had no formal medical training but was well read in both anatomy and
        physiology. He devoted a great deal of time to the study of the spine and
        eventually concluded that all disease was the result of abnormal spinal
        function. Palmer performed his first adjustment in 1895. Subsequent to
        his initial successes, Palmer’s popularity increased and in 1896 he
        founded the first school of chiropractic in Davenport, Iowa, now known
        as the Palmer College of [C]hiropractic. One of Palmer’s first patients
        gave the profession its name by combining the Greek words “chiro”
        (hand) and “praktikos” (done by).
                                            4

Wellmark, alleging discriminatory and anticompetitive practices that

harmed chiropractic doctors. Division I contained the new class action

claims, and Division II retained Mueller’s individual claim. This appeal

only concerns the class action claims in Division I.

       Wellmark’s business consists of selling health insurance plans to

employer groups and providing administrative services to assist others

who     provide       health   insurance        coverage,    such     as    self-funded

governmental entity plans. Wellmark is one of a dozen health insurers in

the state, but retains the largest market share.                 Wellmark creates a

network of preferred health care providers, including doctors of

chiropractic, medical doctors, and osteopathic doctors, and incentivizes

its members to use its preferred provider panel. Wellmark develops its

preferred provider panel by entering into contracts with providers that

govern the terms and conditions of treatment as well as fee schedules, at

times on a take-it-or-leave-it basis. Preferred providers must adhere to

these contracts to receive compensation from Wellmark for services

provided to Wellmark’s members. Preferred provider arrangements are

expressly encouraged by the Iowa legislature as a health care cost control

mechanism. See Iowa Code § 514F.2. The legislature has directed the

_______________________
               ....
               In 1906 Palmer’s son, B.J. Palmer, took over the school and is
       credited with the development of the chiropractic profession. By 1910
       the Palmer School had courses in X-ray studies and was the first to use
       this new technology to detect spinal misalignments. In 1935 B.J. Palmer
       established a research clinic at the school and is credited with developing
       a prototype of the electroencephalogram or EEG.
Kristyn S. Appleby & Joanne Tarver, Medical Records Review § 5.16, at 5–74 (4th ed.
2010). Palmer College of Chiropractic is “[k]nown throughout the profession as The
Fountainhead [because it] changed the world as the first institution to offer chiropractic
education.”      Palmer     College  of   Chiropractic,     Palmer      at    a    Glance,
http://www.palmer.edu/PalmerAtAGlance/(last visited June 12, 2012).
                                             5

Iowa Insurance Commissioner to regulate these preferred provider

arrangements. Id. § 514F.3.

       Stated simply, the plaintiffs in this lawsuit allege Wellmark has

employed       preferred      provider      arrangements         in    an     unlawfully

discriminatory and anticompetitive manner in violation of statutory

insurance provisions and state antitrust laws.

       Division I of the first amended petition contains five counts,

spanning forty pages.          Count I provides factual background for the

claims that follow.          Count II seeks declaratory relief based upon

allegations that Wellmark engages in discriminatory practices that violate

insurance regulatory provisions contained in the Iowa Code that prevent

health insurers from taking actions “on a basis solely related to the

[chiropractor’s] license.”          Iowa Code § 514F.2; accord Iowa Code

§§ 509.3(6), 514.7, 514.23(2), 514B.1(5).               Count III pleads Wellmark

entered into a contract, combination, or conspiracy to unlawfully restrain

trade against chiropractors in violation of section 553.4 of the Iowa

Competition Law. Count III seeks money damages. Count IV also seeks

money damages, alleging Wellmark “abused [its] monopoly power in the

relevant geographic and product markets” to injure plaintiffs in violation

of section 553.5 of the Iowa Competition Law. 3                 Count V repleads the



         3Wellmark is a purchaser of health services on behalf of its members.           See
Kartell v. Blue Shield of Mass., Inc., 749 F.2d 922, 925 (1st Cir. 1984) (“Blue Shield in
essence ‘buys’ medical services for the account of others . . . .”). Wellmark is thus a
“monopsonist,” not a monopolist, as plaintiffs plead. See Herbert Hovenkamp, Federal
Antitrust Policy: The Law of Competition and Its Practice § 1.2(b), at 14 (4th ed. 2011). “A
monopsonist is a monopoly buyer rather than seller.” Id. “Although most antitrust
litigation of market power offenses has involved monopoly sellers rather than buyers,
monopsony can impose social costs on society similar to those caused by monopoly.”
Id. The distinction is not relevant for the issues decided in this opinion, but may be
relevant under other substantive areas of antitrust law. See id. at 14–16.
                                        6

statutory insurance violations alleged in Count II, but seeks injunctive

relief.

          Division I of the first amended petition alleges Wellmark engaged in

substantially similar unlawful conduct for each count in ways that

                (a) violate the various provisions of H.F. 2219 (1986
          (71 G.A.) ch. 1180)) in their contracts and dealings with
          chiropractors and chiropractic patients in order to diminish
          and restrict the care for human ailments by chiropractors for
          which payment will be made by the Wellmark Defendants;

                (b) impose definitions of “chiropractic” and “medical
          necessity” contrary to Chapter 151, Code of Iowa (2007) in
          order to diminish and restrict the care for human ailments
          by chiropractors for which payment will be made by the
          Wellmark Defendants;

                 (c) usurp the authority of the Iowa General Assembly,
          to the detriment of Iowa chiropractors and the treatment and
          therapy offered to their patients, in requiring the use of and
          promulgating standards and rules of practice for
          “Chiropractic Assistants,” a category of health care
          practitioner found nowhere in the present Code of Iowa in
          Chapters 147 through 158 or elsewhere, and in limiting the
          employment of certain modes of physiotherapy if not applied
          by chiropractors or “chiropractic assistants;”

                 (d) impose maximum fee schedules to which
          chiropractors must agree with defendants and with each
          other in order to provide diagnostic and treatment services
          for their patients in Iowa;

                (e) prescribe fees for chiropractic services which are
          discriminatory to doctors of chiropractic in relation to the
          fees for other health care practitioners for the same or
          similar services;

                (f) prescribe limitations upon and make optional the
          coverage of diagnostic and treatment services of
          chiropractors while not imposing the same standards and
          practices to the coverage of diagnostic and treatment
          services of other practitioners of health care in Iowa licensed
          under the chapters of Title IV, subtitle 3, of the Code of Iowa
          [Chapters 147 through 158];

                 (g) agree with over 95% of all Iowa Doctors of Medicine
          (M.D.’s) and Doctors of Osteopathy (D.O.’s) in active practice
          to numerous items of preferential treatment, discriminatory
          to plaintiff, as found in Section 7 of a Settlement Agreement
                                         7
      dated April 27, 2007, . . . [See Love, No. 03–21296–CIV (S.D.
      Fla. Apr. 19, 2008)];

            (h) enter into agreements with various subdivisions of
      the State of Iowa to limit or exclude chiropractic coverage
      from health plans offered to employees of various
      subdivisions of the State of Iowa, based upon the
      encouragement of and false information provided by the
      Wellmark Defendants.

      Wellmark moved to dismiss plaintiffs’ class action claims on

several grounds.      Wellmark asserted plaintiffs’ insurance claims were

within the exclusive jurisdiction of the Iowa Insurance Commissioner

and the insurance provisions plaintiffs relied upon do not create a

private cause of action. As to plaintiffs’ Iowa Competition Law claims,

Wellmark alleged (1) it was immune from liability pursuant to Iowa Code

section 553.6(4), which exempts “activities or arrangements expressly

approved or regulated” by the state; (2) plaintiffs “failed to adequately

plead an antitrust injury and therefore lack standing”; and (3) plaintiffs

“failed to adequately plead facts plausibly suggesting the existence of an

agreement to restrain trade.” Plaintiffs resisted all grounds. 4
      On October 22, 2008, the district court granted Wellmark’s motion

to dismiss plaintiffs’ statutory insurance claims, but not their antitrust

claims. As to the statutory insurance claims, the district court found no
implied cause of action:



        4Wellmark supported its motion with numerous exhibits, including 1986 Iowa

Acts ch. 1180 (H.F. 2219), which enacted the insurance provisions relied on by
plaintiffs; an affidavit by Wellmark’s associate general counsel and assistant board
secretary, Michele Druker, attesting Wellmark’s preferred provider contracts require
insurance commissioner approval; preferred provider agreement prototypes from 2007
and 2001 stamped “Approved” by the insurance commissioner; and the insurance
commissioner’s administrative regulations governing preferred provider agreements,
Iowa Admininstrative Code rule 191—27. The parties stipulated the court should
consider these exhibits along with plaintiffs’ resistance and supporting exhibits in
ruling on Wellmark’s motion to dismiss.
                                      8
      The second, third, and fourth factors of the Seeman test
      establish that there is no implied right of action under these
      statutes.   Thus plaintiffs’ request for declaratory ruling
      based on alleged violations of these statutes, their request
      for injunctive relief based on these statutes, and any
      damages claims based thereon must be dismissed, because
      there is no private right of action and jurisdiction rests
      exclusively with the Commissioner of Insurance.

The district court determined the antitrust claims needed further record

development before a ruling could be made:

            At this early stage of the proceedings, the court cannot
      find, as a matter of law, that the pricing schedules are
      regulated within the meaning of the statutory exemption.
      The court has considered the authorities cited by Wellmark,
      and the different rationales stated therein for finding an
      exemption to the antitrust laws in cases against insurers.
      However, many of these cases were decided either at
      summary judgment, or on a full record made after an
      evidentiary hearing.

The district court also determined plaintiffs sufficiently pleaded an

antitrust injury and conspiracy under Iowa notice pleading standards.

The district court ordered the “claims in Division I of the First Amended

Petition based on violations of Iowa Code Sections 514F.2, 509.3(6),

514.7, 514.23(2), and 514B.1(5) and other statutes enacted in 1986 Iowa

Acts Chapter 1180 are Dismissed” and directed plaintiffs to recast their

petition to allege only the antitrust claims.

      Plaintiffs’ second amended petition did not substantially conform

to the district court’s order, prompting Wellmark to file a second motion

to dismiss or strike, which the district court granted in part. Plaintiffs

responded with a third amended petition alleging only the antitrust

violations in Division I. Wellmark answered and counterclaimed.
                                             9

       On March 16, 2009, Wellmark moved for summary judgment on

Division I (the class action claims) of the third amended petition. 5

Wellmark argued: (1) “The factual record . . . shows that the alleged

discriminatory actions plead by Plaintiffs as anti-trust claims . . . fall

within the exclusive jurisdiction of the Iowa Insurance Commissioner

pursuant to Iowa Code § 553.6(4)”; and (2) “Several of the allegations

contained in Plaintiffs’ Third Amendment to Petition are contrary to

undisputed fact.” The motion contained fourteen pages of “undisputed

facts” that were supported by 185 pages of affidavits and exhibits,

including affidavits by Michele Druker, associate general counsel; Sheryl

Nuzum, group leader of network economics; and Linda Blake, group

leader for individual and small business underwriting.                    The affidavits

explain that Wellmark submits all provider forms incidental to preferred

provider arrangements to the insurance commissioner for approval and

that Wellmark bases its provider reimbursement rates on the Resource-

Based Relative Value System (RBRVS) and Relative Value Units (RVUs)

federally mandated for Medicare. 6               The RVUs assigned by Medicare

        5On April 6, 2009, shortly after Wellmark’s motion for summary judgment, the

district court severed Division I (the class action claims) from Division II (Dr. Mueller’s
individual claim) pursuant to the parties’ stipulation. Division II remained under the
existing case number. The district court ordered plaintiffs to file a recasted third
amended petition including only Division I, which would be separately docketed. This is
an appeal of the separately docketed case.
        6In 1989, President George H.W. Bush enacted legislation mandating the Center

for Medicare and Medicaid Services (CMS), a federal agency within the United States
Department of Human Health and Services, to calculate provider reimbursement rates
under the RBRVS. Omnibus Budget Reconciliation Act of 1989, Pub. L. No. 101–239,
§ 6102, 103 Stat. 2106 (1989) (codified as amended at 42 U.S.C. § 1395w-4 (2006)).
Dr. William Hsiao, a professor of medicine at Harvard, oversaw a research team, which
published the RBRVS in 1988. Ann Marie Marciarille & J. Bradford DeLong, Bending
the Health Cost Curve: The Promise and Peril of the Independent Payment Advisory
Board, 22 Health Matrix 75, 106 n.127 (2012). The system attempts to determine rates
based upon “the time, effort, skill and stress involved in the[] services.” Id. The Relative
Value Scale Updating Committee (RUC), a group of thirty-one private physicians from
different specialties, submits recommendations to the CMS concerning revised values.
                                       10

require different reimbursement rates for spinal manipulation by

chiropractors and by M.D.s and D.O.s, recognizing differences in

overhead, training, and malpractice risks among those professions. The

Nuzum affidavit noted the different reimbursement rates “are common

knowledge in the health care business and would be known by the Iowa

Insurance Commissioner when she approves Wellmark’s preferred

provider arrangements with chiropractors.” The exhibits in the summary

judgment     record   include    Wellmark’s     2001    and    2007    prototype

practitioner agreements, policy forms and manuals incorporated into the

agreements, insurance commissioner notices approving Wellmark’s 2001

and 2007 practitioner agreements, and Wellmark’s standard form to

administer a governmental entity plan.

      Plaintiffs resisted all grounds for summary judgment.             Plaintiffs

denied forty-five of Wellmark’s forty-eight paragraphs of undisputed fact.

Most denials stated: “Deny. This paragraph contains inadmissible legal

conclusions, opinions without adequate foundation, speculation, and

argument. It also fails to state how the affiant [Druker or Nuzum] has or

could have personal knowledge of the facts asserted. Iowa R. Evid.

1.981(5).”    Plaintiffs supported their resistance with two exhibits

containing eighty-nine pages of illustrative Wellmark fee schedules for

chiropractors and other medical providers.

      Wellmark filed supplementary affidavits to demonstrate its affiants

had personal knowledge over the facts asserted. Plaintiffs objected that

the supplemental affidavits are hearsay, speculative, and lack adequate
_______________________
American Medical Association, The RVS Update Committee, http://www.ama-
assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-
billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-
committee.page (last visited June 12, 2012). CMS then accepts or rejects the RUC’s
recommendations. Id.
                                    11

foundation. Plaintiffs also filed three additional exhibits, Mueller’s 1994

participating provider agreement, a 2007 letter documenting provider

form amendments, and a letter from Wellmark’s vice president indicating

Wellmark will begin using the RVU system in 2009.

      The district court held a reported hearing on July 31, 2009. On

September 18, the district court entered summary judgment dismissing

plaintiffs’ remaining antitrust claims. Both plaintiffs and Wellmark filed

motions to amend the ruling.       The district court granted Wellmark’s

motion to add additional findings of undisputed fact and statutory

analysis and denied plaintiffs’ motion.

      The district court ruled plaintiffs’ alleged anticompetitive conduct

was exempt from the Iowa Competition Law, under section 553.6(4). The

district court applied the two-prong federal “state action” immunity test,

concluding:

             In short, the legislature has expressly regulated the
      activities of Wellmark vis-à-vis provider contracts with
      chiropractors (and other medical providers). The first prong
      of the state action exemption is met in this case as to claims
      arising under the provider agreements.
             Turning to the second prong, the court must consider
      whether this state policy is actively supervised by the state,
      with special attention paid to whether decisions are made by
      state authorities or by the private parties themselves. The
      Insurance Commissioner has enacted comprehensive rules
      for insurers’ agreements with providers under Chapter 514F,
      which are contained in Chapter 191 of the Iowa
      Administrative Code, Section 27. Of significance, the rules
      require approval of prototype preferred provider agreements.
      191 I.A.C. 27.5(3). It is undisputed that Wellmark submits
      its   prototype    preferred     provider    agreements     with
      chiropractors to the Insurance Commissioner for approval,
      and that they have in fact been approved. Many of the
      allegations in the petition relate to provisions of the provider
      agreements, or to physical medicine guides that are
      incorporated into the provider agreements. . . . The court
      concludes that the provider agreements challenged in this
      case are actively supervised by a state agency, the Iowa
      Insurance Commissioner.
                                    12

      With respect to the Love v. Blue Cross Blue Shield settlement, the

only alleged anticompetitive conduct not approved by the insurance

commissioner, the district court granted summary judgment in favor of

Wellmark.     The district court found the settlement exempt under the

Noerr-Pennington doctrine and, alternatively, found no genuine issue of

material fact as to whether the settlement discriminated against

chiropractors. The district court reasoned:

              Under the Noerr-Pennington doctrine, settlement
      agreements approved by a court are immune from antitrust
      liability, absent a sham. . . .        The Love Settlement
      Agreement, and the court order approving it, appear genuine
      and valid.    Plaintiffs have submitted no countervailing
      evidence that the settlement is a sham. The court in that
      case found that the settlement was an arm’s length
      transaction, and that it is reasonable, adequate, and is not
      the result of collusion between the parties. As such, it is
      shielded from antitrust liability under Noerr.
             Secondly, there is no factual basis for an antitrust
      claim concerning Section 7 of the Love Settlement
      Agreement. Wellmark’s Assistant General Counsel, Michele
      Druker, submitted a spreadsheet containing every item
      contained in Section 7 of the settlement agreement. This
      sets forth a series of procedural requirements, such as
      availability of fee schedules, reduced precertification
      requirements, greater notice of policy and procedure
      changes, etc.    Most of the items are being applied to
      agreements with chiropractors. Some are not applicable.
      Plaintiffs submitted no opposing affidavits controverting
      these facts.

Plaintiffs filed an application for interlocutory appeal, which we granted.

      II. Standard of Review.

      “We review a district court’s ruling on a motion to dismiss for the

correction of errors at law.” Dier v. Peters, 815 N.W.2d 1, 4 (Iowa 2012).

A motion to dismiss may be granted when the petition’s allegations,

taken as true, fail to state a claim upon which relief may be granted.

Geisler v. City Council, 769 N.W.2d 162, 165 (Iowa 2009) (citing Iowa R.

Civ. P. 1.421(1)(f)).
                                          13

       We review the district court’s grant of summary judgment for

correction of errors at law.        Emp’rs Mut. Cas. Co. v. Van Haaften, 815

N.W.2d 17, 22 (Iowa 2012). “Summary judgment is appropriate if there

are no genuine issues of material fact and the moving party is entitled to

judgment as a matter of law.” Id. The evidence is viewed in the light

most favorable to the nonmoving party. Id. However, “[w]hen a motion

for summary judgment is properly supported, the nonmoving party is

required to respond with specific facts that show a genuine issue for

trial.” Green v. Racing Ass’n of Cent. Iowa, 713 N.W.2d 234, 245 (Iowa

2006); accord Iowa R. Civ. P. 1.981(5).

     III. Whether the District Court Properly Dismissed Plaintiffs’
Claims Brought Under the Insurance Statutes for Lack of a Private
Cause of Action.
       Plaintiffs’ first amended petition alleged Wellmark’s preferred

provider contracts, administration of the Iowa State University health

plan, and participation in the Love settlement violated Iowa Code

sections 509.3(6), 7 514.7, 8 514.23(2), 9 514B.1(5)(c), 10 and 514F.2.11

        7Iowa Code § 509.3(6) (“A policy of group health insurance may limit or make

optional the payment or reimbursement for lawful diagnostic or treatment service by all
licensees under chapters 148 and 151 on any rational basis which is not solely related
to the license under or the practices authorized by chapter 151 . . . . (Emphasis
added.)).
       8Iowa  Code § 514.7(3) (“A group subscriber contract may limit or make optional
the payment or reimbursement for lawful diagnostic or treatment service by all
licensees under chapters 148 and 151 on any rational basis which is not solely related
to the license under or the practices authorized by chapter 151 or is not dependent
upon a method of classification, categorization, or description based upon differences in
terminology used by different licensees in describing human ailments or their diagnosis
or treatment.” (Emphasis added.)).
       9Iowa Code § 514.23(2) (“A corporation organized and governed by this chapter

which becomes a mutual insurer under this section shall continue as a mutual insurer
to be governed by the provisions of section 514.7 and shall also be governed by section
509.3, subsection 6.” (Emphasis added.)).
       10Iowa Code § 514B.1(5)(c) (“A prepaid group plan of health care services may
limit or make optional the payment or reimbursement for lawful diagnostic or treatment
                                           14

Section 514F.2 prevents health insurers from utilizing preferred provider

arrangements to limit payments “on a basis solely related” to the

provider’s license—the nub of plaintiffs’ claims.               The provisions were

enacted together in H.F. 2219 in 1986. See 1986 Iowa Acts ch. 1180.

Wellmark moved to dismiss these claims, arguing H.F. 2219 does not

create a private cause of action.

       Not all statutory violations give rise to a private cause of action. A

private statutory cause of action exists “only when the statute, explicitly

or implicitly, provides for such a cause of action.”                        Sanford v.

Manternach, 601 N.W.2d 360, 371 (Iowa 1999). Plaintiffs concede H.F.

2219 does not expressly create a private cause of action. The issue is

whether those provisions implicitly created a private right to sue. Marcus

v. Young, 538 N.W.2d 285, 289 (Iowa 1995).

       In our seminal case, Seeman v. Liberty Mutual Insurance Co., we

adopted a four-factor test to determine whether a statute provides a

private cause of action:

             1. Is the plaintiff a member of the class for whose
       benefit the statute was enacted?
             2. Is there any indication of legislative intent, explicit
       or implicit, to either create or deny such a remedy?


_______________________
service by all licensees under chapters 148 and 151 on any rational basis which is not
solely related to the license under or the practices authorized by chapter 151 or is not
dependent upon a method of classification, categorization, or description based upon
differences in terminology used by different licensees in describing human ailments or
their diagnosis or treatment.” (Emphasis added.)).
       11Iowa   Code § 514F.2 (permitting provider agreements “provided these systems
do not limit or make optional payment or reimbursement for health care services on a
basis solely related to the license under or the practices authorized by chapter 151 or on
a basis that is dependent upon a method of classification, categorization, or description
based upon differences in terminology used by different licensees under the chapters of
Title IV, subtitle 3, of the Code in describing human ailments or their diagnosis or
treatment” (emphasis added)).
                                     15
            3. Would allowing such a cause of action be
      consistent with the underlying purpose of the legislation?
           4. Would the private cause of action intrude into an
      area over which the federal government or a state
      administrative agency holds exclusive jurisdiction?

Marcus, 538 N.W.2d at 288 (citing Seeman, 322 N.W.2d at 38).            The

Seeman court modified the four-factor federal test articulated in Cort v.

Ash, 422 U.S. 66, 78, 95 S. Ct. 2080, 2088, 45 L. Ed. 2d 26, 36–37

(1975). Seeman, 322 N.W.2d at 40. “If any one of these factors is not

satisfied, there is no implied cause of action.” Kolbe v. State, 625 N.W.2d

721, 727 (Iowa 2001); see also Touche Ross & Co. v. Redington, 442 U.S.

560, 575, 99 S. Ct. 2479, 2489, 61 L. Ed. 2d 82, 96 (1979) (“The central

inquiry remains whether Congress intended to create, either expressly or

by implication, a private cause of action.”).

      Seeman is particularly analogous because it analyzed whether

insurance provisions in the same subtitle of the Code as those contained

in H.F. 2219 created a private cause of action. 322 N.W.2d at 36. In

that case, David Seeman sued Liberty Mutual Insurance Co., claiming

the insurance company unreasonably delayed payment on the settlement

of his workers’ compensation claim.       Id.   Seeman brought his lawsuit

under section 507B.4 of the Insurance Trade Practices Act, which

prohibits unfair methods of competition and deceptive acts by insurance

companies.    Id. at 40.   Although we found individual claimants were

within the class of persons the Act was intended to benefit, we declined

to find a private cause of action because we determined the legislature

intended the Insurance Trade Practices Act to be “regulatory in nature.”

Id. at 42.   We reasoned there was no existing remedy prior to the

legislation for an insurer’s bad-faith failure to settle an insurance claim,

and the legislative history stated the “ ‘purpose of the chapter is to
                                    16

regulate trade practices.’ ”   Id. at 41–42 (quoting Iowa Code section

507B.1 (emphasis added)). Moreover, the chapter provided the insurance

commissioner with specified administrative powers to investigate,

adjudicate, remedy, and sanction prohibited acts of unfair practices. Id.

at 42; see also Scotts v. Eveleth, 688 N.W.2d 803, 808–09 (Iowa 2004)

(holding no private cause of action exists when “Iowa Code section 272.2

gives the board the exclusive authority to ‘[e]nforce rules adopted by the

board through revocation or suspension of a license, or by other

disciplinary action against’ a teacher”); Young, 538 N.W.2d at 289

(relying on the existence of administrative remedies in Iowa Code chapter

22, the Open Records Act, to find no private cause of action). Plaintiffs’

statutory insurance claims fail here for the same reasons as those under

Seeman.

      The legislature enacted H.F. 2219 to benefit chiropractors as well

as consumers. But, in light of Seeman, the history of H.F. 2219, and the

available administrative remedies, we conclude the remaining factors do

not support recognition of a private cause of action.      Accordingly, the

district court properly dismissed plaintiffs’ statutory insurance claims.

      Prior to H.F. 2219, chiropractors were excluded from Iowa statutes

regulating health insurance coverage.       Judge Stuart, a former Iowa

Supreme Court Justice, summarized the state of Iowa law on this issue

in 1980:

            Chapter 514 of the Iowa Code clearly expresses a
      policy excluding chiropractic services from coverage by
      health care service corporations. Throughout that chapter,
      the state legislature repeatedly stated precisely the particular
      services covered. No mention is ever made of chiropractors,
      the practice of chiropractic or Chapter 151 of the Iowa Code
      which governs aspects of the practice of chiropractic,
      including licensing. The Court believes that the omission of
      any mention of chiropractic coverage in Chapter 514 directly
                                      17
      suggests that the legislature intended to prohibit coverage of
      their activities by health care service corporations.

Health Care Equalization Comm. of the Iowa Chiropractic Soc’y v. Iowa
Med. Soc’y, 501 F. Supp. 970, 989–90 (S.D. Iowa 1980), aff’d, 851 F.2d

1020 (8th Cir. 1988).       The subsequent 1986 amendments expressly

sought to “provid[e] for optional payment by corporations subject to

chapters 509, 514, and 514B for services performed by chiropractors.”

1986 Iowa Acts ch. 1180. Plaintiffs contend this history indicates the

legislature     intended   to   provide    chiropractors   private   rights   of

enforcement. We disagree.

      Before H.F. 2219 was enacted, chiropractors had no statutory or

common law remedy if health care insurers declined to cover their

services.     In Seeman, we found chapter 507B did not create a private

cause of action, in part because, before that chapter’s enactment,

individuals had no private common law or statutory remedy against

insurers for the conduct proscribed by that chapter. 322 N.W.2d at 41–

42. We reasoned that, if the legislature wanted to create a private cause

of action when none previously existed, presumably it would have done

so expressly. See id. The same logic applies here with even greater force.

H.F. 2219 was enacted four years after our decision in Seeman.                We

presume the legislature was aware of our holding in Seeman refusing to

recognize a private cause of action in related insurance provisions.

Welch v. Iowa Dep’t of Transp., 801 N.W.2d 590, 600 (Iowa 2011) (“ ‘The

legislature is presumed to know the state of the law, including case law,

at the time it enacts a statute.’ ” (quoting State v. Jones, 298 N.W.2d 296,

298 (Iowa 1980))). Given that timing, we decline to infer from legislative

silence in the 1986 amendments the intent to provide chiropractors or
                                       18

other licensed health care professionals a private right of action for

violation of the insurance statutes.

      Plaintiffs in this case are suing under insurance statutes regarded

under Seeman as “essentially regulatory in nature.” 322 N.W.2d at 42.

We reach the same conclusion here as in Seeman: The legislature

“intended only to invest the insurance commissioner with administrative

enforcement power . . . .      Accordingly, we hold that the legislature

implicitly intended the insurance commissioner’s powers to be the

exclusive means of enforcing” the statute.        Id. at 43.   The legislature

provided the insurance commissioner with extensive administrative

powers over health insurance practices.          Iowa Code section 514F.3

directs the insurance commissioner to “adopt rules for preferred provider

contracts and organizations” concerning “but not . . . limited to . . .

preferred provider arrangements and participation requirements, health

benefit plans, and civil penalties.”          The legislature explained its

reasoning:

      Presently,    preferred      provider     organizations,    i.e.,
      arrangements wherein a health benefit plan provides for
      treatment by select providers, are unregulated. This bill
      would authorize the division of insurance to adopt rules
      regulating those entities, in particular, to adopt the national
      association of insurance commissioners’ model provision.

H.F. 2307, 72d G.A., Reg. Sess. § 604 Explanation (Iowa 1988) (emphasis

added). This history confirms the legislature intended H.F. 2219 to be

regulatory in nature.

      Pursuant    to    the   legislature’s   authorization,   the   insurance

commissioner has adopted administrative rules regulating preferred

provider arrangements and detailing administrative enforcement powers.

See Iowa Admin. Code r. 191—27 (governing preferred provider

arrangements). The insurance commissioner determined civil penalties
                                       19

for violating preferred provider arrangements regulations “shall be

imposed in the amount, and pursuant to the procedure, set forth in Iowa

Code sections 507B.6, 507B.7, and 507B.8.”              Id. r. 191—27.7.        The

operative statutes and rules authorize the insurance commissioner to

issue charges, hold hearings, and levy civil penalties up to $50,000 for

improper preferred provider arrangements, all subject to judicial review.

See Iowa Code §§ 507B.6–8.           Seeman relied on such administrative

procedures in holding the Insurance Trade Practices Act did not create

an implied private cause of action. 322 N.W.2d at 42 (citing Iowa Code

sections 507B.6, 507B.7, 507B.8, the enforcement powers in the

Insurance Trade Practices Act).

       Section 514F.3 specifically commands the insurance commissioner

to    adopt   rules    and   procedures     to   regulate     preferred    provider

arrangements.      Plaintiffs attempt to distinguish Seeman by arguing in

that case the legislature enacted the administrative remedies, while here

the    insurance      commissioner    promulgated       the    regulations      and

administrative remedies.      This is a distinction without a difference for

determining whether an implied private right of action exists.                  We

rejected this distinction in Eveleth, which held “[s]ection 272.2 clearly

suggests that this provision was intended to be a regulatory measure

designed to provide the board with authority to suspend or revoke a

teacher’s license in those situations when violations of its provisions

occur.” 688 N.W.2d at 809; see also Rowen v. LeMars Mut. Ins. Co. of

Iowa, 230 N.W.2d 905, 909 (Iowa 1975) (“When the legislature has given

an    administrative    agency   jurisdiction    to   entertain   the     particular

controversy, we have held the jurisdiction is exclusive and must be

exhausted before resort to the courts . . . .”).
                                        20

       Plaintiffs are not left without a remedy absent an implied cause of

action.       Plaintiffs may use chapter 17A administrative remedies to

enforce       H.F.   2219—they   must    simply      turn   to   the   insurance

commissioner first.       Plaintiffs may petition the commissioner for a

declaratory order as to the legality of Wellmark’s allegedly discriminatory

activities.    See Iowa Code § 17A.9.        Plaintiffs could then seek judicial

review of the ruling. Id. Wellmark’s exhibits show H.F. 2219 has been

the subject of at least two administrative proceedings resulting in

declaratory rulings.

       Plaintiffs under certain circumstances also may initiate “contested

case” proceedings under chapter 17A to obtain an evidentiary hearing for

their alleged grievances.    Id. § 17A.2(5) (defining “contested case” as a

“proceeding including but not restricted to ratemaking, price fixing, and

licensing in which the legal rights, duties or privileges of a party are

required by Constitution or statute to be determined by an agency after

an opportunity for an evidentiary hearing”); see, e.g., Lifeline Ambulance,

Inc. v. Iowa Ins. Div., 505 N.W.2d 186, 187 (Iowa 1993) (reviewing

insurance commissioner contested-case ruling to uphold an HMO’s

decision to terminate a group health insurance plan under section

514B.17).

       Finally, plaintiffs can petition for “other agency action” pursuant to

section 17A.2(2), which also is subject to judicial review.            Iowa Code

§ 17A.19(10); see also Travelers Indem. Co. v. Comm’r of Ins., 767 N.W.2d

646, 650 (Iowa 2009) (insurance commissioner’s adjudication of a

workers’ compensation premium dispute reviewed as “other agency

action”).

       The insurance commissioner oversees a uniform, statewide scheme

to regulate preferred provider arrangements and other health insurer
                                           21

activities. 12   The insurance commissioner is permitted to utilize his

expertise and specialization to make an administrative record to resolve

disputes within his jurisdiction. On judicial review of the commissioner’s

ruling, the commissioner will be a party and the reviewing court’s

adjudication will apply statewide to the health insurance industry. We

do not believe the legislature intended to create a private cause of action

to allow civil juries to second-guess conduct approved by the insurance

commissioner and subject to judicial review from administrative

proceedings.

       We conclude our legislature chose to provide the Iowa Insurance

Commissioner with exclusive powers to regulate health insurance

practices under these statutes. For these reasons, we hold Iowa Code

sections 509.3(6), 514.7, 514.23(2), 514B.1(5)(c), and 514F.2, enacted as

part of H.F. 2219, do not create a private cause of action.

     IV. Whether the District Court Erred by Applying the State
Action Exemption, Iowa Code Section 553.6(4), to Grant Summary
Judgment Against Plaintiffs on Their State Antitrust Claims.
       Plaintiffs’ third amended petition alleges that discriminatory

provisions in Wellmark’s preferred provider arrangements constitute a



        12New legislation, effective July 1, 2012, prohibits health insurers from imposing

larger copayments for chiropractic services than for services by medical doctors or
osteopaths. 2012 Iowa Legis. Serv. H.F. 2465, § 36 (West 2012) (to be codified at Iowa
Code § 514C.29) (“[A] policy, contract, or plan providing for third-party payment or
prepayment of health or medical expenses shall not impose a copayment or coinsurance
amount on an insured for services provided by a doctor of chiropractic licensed
pursuant to chapter 151 that is greater than the copayment or coinsurance amount
imposed on the insured for services provided by a person engaged in the practice of
medicine and surgery or osteopathic medicine and surgery under chapter 148 for the
same or a similar diagnosed condition even if a different nomenclature is used to
describe the condition for which the services are provided.”).             Legislation and
regulations administered by the Iowa Insurance Division have uniform applicability
statewide. By contrast, plaintiffs’ allegations in this litigation target the conduct of a
single health insurer.
                                     22

conspiracy to restrain trade against chiropractors in violation of section

553.4 and an abuse of monopoly power in violation of section 553.5.

Plaintiffs’ alleged anticompetitive conduct can be grouped into three

categories: (1) procedural requirements and conditions of treatment,

(2) fee payment schedules, and (3) administration of state self-funded

group plans that typically have identical preferred provider panels.

      Wellmark moved for summary judgment, asserting its preferred

provider arrangements are exempt from plaintiffs’ antitrust claims

pursuant to section 553.6(4).       This section provides that the Iowa

Competition Law “shall not be construed to prohibit . . . activities or

arrangements expressly approved or regulated by any regulatory body or

officer acting under authority of this state.” Iowa Code § 553.6(4). The

district court granted Wellmark’s motion, and we now are called upon to

review the correctness of this ruling.

      We have applied the so-called “state action” exemption of section

553.6(4) in two prior cases.    Nw. Bell Tel. Co. v. Iowa Utils. Bd., 477

N.W.2d 678, 685–86 (Iowa 1991); Neyens v. Roth, 326 N.W.2d 294, 298–

99 (Iowa 1982). As we noted in those two cases, private anticompetitive

conduct is exempt from federal antitrust laws if (1) the conduct is

undertaken pursuant to a “ ‘clearly articulated and affirmatively

expressed’ ” state policy and (2) the policy is “ ‘actively supervised’ ” by

the state itself.   See Nw. Bell, 477 N.W.2d at 685 (quoting Cal. Retail

Liquor Dealers Ass’n v. Midcal Aluminum, Inc., 445 U.S. 97, 105, 100

S. Ct. 937, 943, 63 L. Ed. 2d 233, 243 (1980)); Neyens, 326 N.W.2d at

298 (same). We also observed in Neyens that the Iowa Competition Law

has a uniformity clause. See Iowa Code § 553.2 (stating that the Iowa

Competition Law “shall be construed to complement and be harmonized

with the applied laws of the United States which have the same or
                                     23

similar purpose”); Neyens, 326 N.W.2d at 298; see also Comes v.

Microsoft Corp., 646 N.W.2d 440, 452 (Iowa 2002) (Cady, J., dissenting)

(noting that in section 553.2, the legislature provided “a specific rule of

construction” for interpreting the Iowa Competition Law); Nw. Bell, 477

N.W.2d at 686.

      “The general rule is that exemptions from coverage of competition

laws are to be narrowly applied.” Neyens, 326 N.W.2d at 298. The state

action exemption is an affirmative defense as to which the defendant

bears the burden of proof. See Nw. Bell, 477 N.W.2d at 685 (“The first

prong of the state action exemption requires a showing . . . .”) (Emphasis

added.); see also F.T.C. v. Ticor Title Ins. Co., 504 U.S. 621, 638, 112

S. Ct. 2169, 2179, 119 L. Ed. 2d 410, 425 (1992) (“[T]he party claiming

the immunity must show that state officials have undertaken the

necessary steps to determine the specifics of the price-fixing or

ratesetting scheme.”); Yeager’s Fuel, Inc. v. Penn. Power & Light Co., 22

F.3d 1260, 1266 (3d Cir. 1994) (“[S]tate action immunity is an affirmative

defense as to which [party asserting immunity] bears the burden of

proof.”); 1 Louis Altman & Malla Pollack, Callmann on Unfair Competition,

Trademarks and Monopolies § 4:4, at 4-62 (4th ed. Supp. 2012) (“State

action immunity is an affirmative defense, and the defendant has the

burden of establishing its eligibility for that defense.”). Whether the state

action exemption is established is a question of law for the court. Trigen

Okla. City Energy Corp. v. Okla. Gas & Elec. Co., 244 F.3d 1220, 1225

(10th Cir. 2001); TEC Cogeneration, Inc. v. Fla. Power & Light Co., 76 F.3d

1560, 1567 (11th Cir.), modified, 86 F.3d 1028 (1996).

      Plaintiffs argue that we should apply the state action exemption to

this case as it is currently interpreted by the federal courts. See Ticor

Title Ins. Co., 504 U.S. at 634, 638, 112 S. Ct. at 2177, 2179, 119
                                          24

L. Ed. 2d at 423, 425 (holding that, for the exemption to apply, “the

potential for state supervision [must be] realized in fact” and “the State

[must] exercise[] sufficient independent judgment and control so that the

details of the rates or prices [are] established as a product of deliberate

state intervention, not simply by agreement among private parties”).13

Wellmark counters that we should apply the “plain language” of the Iowa

version of the exemption. Both sides argue that they would prevail even

under the other side’s legal interpretation of the exemption.

       We agree with plaintiffs that, even accepting Wellmark’s view of the

state action exemption, it does not apply here. Different governmental

reviews are for different purposes. When a library checks in a book, it is

verifying that the book was returned, not approving the contents of the

book. When the county grants a marriage license, it is indicating that

the couple may be lawfully married, not that they are necessarily a good

match.        So too here, the present record indicates that, when the

insurance division approves Wellmark’s preferred provider forms, it is

indicating those forms comply with the legal requirements of chapter

514F and its implementing regulations.              It is not comparing specific

chiropractor rates to physician rates, which are not even actually

disclosed in those forms. Although Wellmark uses the RBRVS system

created for Medicare to reimburse chiropractors, Wellmark retains

discretion to apply a “Wellmark determined adjustment factor” to alter

the rates.      Wellmark did not disclose this adjustment factor to the

insurance commissioner.


       13We   note the United States Supreme Court recently granted certiorari in a
hospital state action immunity case, F.T.C. v. Phoebe Putney Health Sys., Inc., 663 F.3d
1369 (11th Cir. 2011), cert. granted, 80 U.S.L.W. 3707 (U.S., June 25, 2012) (No. 11–
1160, 11A811).
                                    25

      It is true that the State of Iowa encourages health insurers to enter

into preferred provider arrangements and requires a prototype of any

such arrangement to be submitted for prior review by the insurance

division.   See Iowa Admin. Code r. 191—27.5(3).       It is also true that

Wellmark submitted its preferred provider forms to the division and that

those forms were approved.

      Nonetheless, for the “activity or arrangement” to be exempt from

the antitrust laws, Wellmark must establish that it was “expressly

approved or regulated” by a regulatory body or an officer acting under

state authority. Iowa Code § 553.6(4). To put it another way, the alleged

anticompetitive practice must be “ ‘expressed as state policy’ ” and

“ ‘actively supervised by the state.’ ”   Nw. Bell, 477 N.W.2d at 685

(citation omitted); Neyens, 326 N.W.2d at 298–99; see also Cal. Retail

Liquor Dealers, 445 U.S. at 105, 100 S. Ct. at 943, 63 L. Ed. 2d at 243;

A.D. Bedell Wholesale Co. v. Philip Morris Inc., 263 F.3d 239, 260 (3d Cir.

2001) (“It is the conduct that violates the antitrust laws that states must

‘actively supervise’ in order for Parker immunity to attach.”).    “Rubber

stamp approval of private action does not constitute state action.” A.D.

Bedell, 263 F.3d at 260.

      Wellmark has not established the insurance division reviews

preferred provider agreements in order to regulate the rates paid to

different classes of health care providers such as doctors and

chiropractors. Rather, it appears the review is designed to assure fair

and equitable access to the preferred provider network and to protect

nonparticipants in the network. See, e.g., Iowa Admin. Code rs. 191—

27.4 (allowing but limiting incentives for use of preferred providers), 27.5

(listing participation requirements).     In short, the purpose of the

insurance division’s review is to regulate the overall relationship between
                                      26

preferred provider participants and nonparticipants, not to monitor rates

paid to or conditions imposed upon different categories of preferred

provider panelists. This is consistent with the authority conferred by the

underlying statute, which provides:

             The commissioner of insurance shall adopt rules for
      preferred provider contracts and organizations, both those
      that limit choice of specific provider and those that do not.
      The rules adopted shall include, but not be limited to, the
      following subjects: preferred provider arrangements and
      participation requirements, health benefit plans, and civil
      penalties.

Iowa Code § 514F.3.

      Thus, the initial section of the relevant regulations explains:

            The purpose of this chapter is to encourage health
      care cost containment while preserving quality of care by
      allowing health care insurers to enter into preferred provider
      arrangements and by establishing minimum standards for
      preferred arrangements and the health benefit plans
      associated with those arrangements.

Iowa Admin. Code r. 191—27.1. As this section reveals, the underlying

purpose of the chapter is to set minimum standards, not to regulate rate

differentials.   The next section of the regulations sets forth a series of

definitions.     Id. r. 191—27.2.   The third section then states what a
preferred provider arrangement shall contain “at minimum”:

            a. Establish the amount and manner of payment to
      the preferred provider. The amount and manner of payment
      may include capitation payments for preferred providers.
           b. Include mechanisms which are designed to
      minimize the cost of the health benefit plan. These
      mechanisms may include among others:
               (1) The review or control of utilization of health care
               costs.
               (2) A procedure for determining whether health care
               services rendered are medically necessary.
            c. Ensure reasonable access to covered services
      available under the preferred provider arrangement.
                                        27

Id. r. 191—27.3(1).       Hence, a preferred provider arrangement must

establish an amount and manner of payment, and a procedure for

determining medical necessity, and presumably would be rejected by the

insurance division if it lacked these items. But, there is no indication

that the insurance division reviews and approves the actual rates of

payment or regulates the specific terms of access to chiropractors as

compared with physicians. 14         By way of analogy, our appellate rule

6.903(2) requires the appellant to file a brief containing a table of

contents, a table of authorities, a statement of the issues, a routing

statement, a statement of the case, a statement of the facts, an argument

section, and a conclusion. Our clerk’s office typically rejects briefs that

do not meet these minimum standards, but this does not mean that by

filing the brief the clerk approves of the appellant’s argument.

       The remaining regulations generally are intended to protect

nonparticipants and participants who use noncovered services from

unfair discrimination. Thus, rule 27.3(2) provides, “A preferred provider

arrangement shall not unfairly deny health benefits for medically

necessary covered services.” Rule 27.3(3) provides that the regulations

will cover preferred provider arrangements even when not sponsored by

licensed insurers.      Rule 27.4 enshrines additional nondiscrimination

protections:

             27.4(1) A health care insurer may issue a health
       benefit plan which provides for incentives for covered
       persons to use the health care services of a preferred
       provider.    The policies or subscriber agreements shall
       contain at least all of the following provisions:


       14The  fee schedules that Wellmark submitted were merely “Illustrative,”
according to the charts, comparing “Facility” and “Non-Facility” and “PPO/Indemnity”
and “HMO.”
                                    28
            a. A provision that if a covered person receives
      emergency services specified in the preferred provider
      arrangement and cannot reasonably reach a preferred
      provider, emergency services rendered during the course of
      the emergency will be reimbursed as though the covered
      person had been treated by a preferred provider, subject to
      any restriction which may govern payment by a preferred
      provider for emergency services.
            b. A provision which clearly identifies the differentials
      in benefit levels for health care services of preferred
      providers and benefit levels for health care services of
      nonpreferred providers.
            27.4(2) If a health benefit plan provides differences in
      benefit levels payable to preferred providers compared to
      other providers, such differences shall not unfairly deny
      payment for covered services and shall be no greater than
      necessary to provide a reasonable incentive for covered
      persons to use the preferred provider.

So does rule 27.5:

             27.5(1) A health care insurer may place reasonable
      limits on the number or classes of preferred providers which
      satisfy the standards set forth by the health care insurer,
      provided that there is no discrimination against providers on
      the basis of religion, race, color, national origin, age, sex or
      marital status.
            27.5(2) Notwithstanding any other provision of this
      chapter, a health care insurer may issue policies or
      subscriber agreements which provide benefits for health care
      services only if the services have been rendered by a
      preferred provider, provided the program has met all
      standards imposed by the commissioner for availability and
      adequacy of covered services.
            27.5(3) A health care insurer shall file with the
      commissioner for the commissioner’s prior review a
      prototype of any preferred provider arrangement and of the
      health care plan’s policy, contract, or subscriber agreement
      associated with the arrangement, together with any changes
      in the prototype. Use of the prototypical preferred provider
      arrangement and health care plan’s policy, contract, or
      subscriber agreement is conditioned upon approval of these
      documents by the commissioner.

Rule 27.6 states that “[a] health insurer subject to this chapter shall be

subject to and is required to comply with all other applicable laws and

rules and regulations of this state.”      Rule 27.7 indicates that civil
                                          29

penalties for violation of this chapter “shall be imposed in the amount,

and pursuant to the procedure, set forth in Iowa Code sections 507B.6,

507B.7, and 507B.8.” Lastly, rule 27.8 contains certain whistleblower-

type protections:

              27.8(1) A health care insurer shall not prohibit a
       participating provider from or penalize a participating
       provider for discussing treatment options with covered
       persons, irrespective of the health care insurer’s position on
       the treatment options, or from advocating on behalf of
       covered persons within the utilization review or grievance
       processes established by the health care insurer or a person
       contracting with the health care insurer.
             27.8(2) A health care insurer shall not penalize a
       provider because the provider, in good faith, reports to state
       or federal authorities any act or practice by the health care
       insurer that, in the opinion of the provider, jeopardizes
       patient health or welfare.

       These regulations are not directed to the regulation of rate

differentials for particular services. Their purpose, rather, is to insure

that health insurers do not abuse their overall relationship with patients

and providers through the use of preferred provider plans.                  Thus, if a

clinic decided to sue Wellmark under the Iowa Competition Law alleging

that Wellmark had engaged in prohibited section 553.5 monopolization

by excluding it from a preferred provider arrangement, the section
553.6(4) state action exemption might well apply. 15                But, it does not



       15This  point is illustrated by Health Care Equalization Committee of the Iowa
Chiropractic Society v. Iowa Medical Society, 851 F.2d 1020 (8th Cir. 1988). In that
case, chiropractors sued Wellmark’s predecessor for antitrust violations, challenging its
refusal to include chiropractic services in health care service plans. Health Care
Equalization Comm., 851 F.2d at 1022. The court found the state action exemption
available, noting that under state law at that time, “the exclusion of chiropractors from
health care service plans was not merely contemplated by the State of Iowa, but
compelled.” Id. at 1026. The Eighth Circuit thus found the state action exemption
applied, not because some state regulation existed in the general area, but because the
decisions being challenged as anticompetitive were directly covered by regulation.
Nowadays state law mandates the inclusion rather than the exclusion of chiropractic
                                         30

appear that the legislature has decided generally to remove the setting of

reimbursement rates by health insurance companies from the operations

of the marketplace or from claims under the Iowa Competition Law.

       A United States Supreme Court decision is on point. In Patrick v.

Burget, an Oregon physician who had lost privileges at a hospital for

allegedly anticompetitive reasons brought suit under the antitrust laws.

486 U.S. 94, 96–98, 108 S. Ct. 1658, 1660–61, 100 L. Ed. 2d 83, 89–90

(1988).    Oregon, like other states, had a state-mandated and state-

regulated peer-review process, which the hospital had followed in

attempting to terminate the physician’s privileges. Id. at 97, 101–02, 108

S. Ct. at 1661, 1663–64, 100 L. Ed. 2d at 89–90, 92–93. Nonetheless,

the Supreme Court rejected the state action defense in a unanimous

decision because the record showed that the various state agencies did

not review the merits of individual peer-review decisions, as opposed to

overall peer-review procedures.         As the Supreme Court put it, “The

Health Division’s statutory authority over peer review relates only to a

hospital’s procedures; that authority does not encompass the actual

decisions made by hospital peer-review committees.”               Id. at 102, 108

S. Ct. at 1664, 100 L. Ed. 2d at 93.             Here, likewise, the regulatory

scheme does not address the fairness of specific rates paid to

chiropractors vis-à-vis doctors.

       As noted by the parties, Wellmark filed a lengthy submission on

Friday, July 27, 2001, which the division stamped “approved” on the very

next business day, Monday, July 30.            This did not occur because the

division’s employees took shortcuts in their work. It happened because

_______________________
services, see, e.g., Iowa Code section 514.7(3), but the conceptual point remains the
same.
                                    31

the scope of review called for by the law and the regulations was limited.

Wellmark offered no affidavit or depostion testimony of the insurance

commissioner or any employee of the insurance division involved in

approving Wellmark’s submissions.        The insurance division conducted

no hearing. There is no evidence in this record the insurance division

has ever rejected or required revisions to the reimbursement rates or

terms of access in a health insurer’s preferred provider arrangement.

Nor does the record reflect the insurance division has ever requested

additional information concerning rate differentials.        We conclude

Wellmark failed to establish a regulatory review sufficient to exempt

Wellmark under section 553.6(4) from an antitrust lawsuit alleging that

it conspired with physicians to underpay chiropractors or impose unfair

terms on them.

      To a large extent, the affidavits submitted by Wellmark are an

effort to defend the merits of its pricing decisions rather than an attempt

to show that the state reviews and regulates those prices. For example,

the Nuzum affidavit explains for fifteen paragraphs how Wellmark uses

the RBRVS system and why it is fair to chiropractors.          In the last

paragraph, the affiant attempts to tie everything together by stating:

      The total amounts available for provider reimbursement by
      Wellmark are ultimately determined by state regulations
      requiring that provider fees be high enough to provide
      reasonable access for members to each provider type,
      including chiropractors.

Thus, Wellmark’s theory of implicit rate approval asserts that the

company has to pay chiropractors enough because if chiropractor fees

were too low, chiropractors would not join the preferred provider

arrangement, and there would not be “reasonable access to covered

services,” as required by rule 191—27.3(1).         In this indirect way,
                                           32

according to Wellmark, the insurance division regulates rates. We do not

believe this satisfies section 553.6(4).        Demonstrating that regulations

provide, in some indirect way, an incentive for Wellmark to compensate

chiropractors adequately is different from demonstrating the insurance

commissioner     in   fact     regulated    and   approved   the   specific   rate

differentials at issue here.

      Under Wellmark’s reasoning, even if all the health insurance

companies doing business in Iowa had engaged in a blatant horizontal

conspiracy to cap the rates they paid for chiropractic care, no one could

seek redress under the antitrust laws because of the state action

exemption. Thus, health insurance companies in Iowa would be free to

engage in the kind of conduct for which ordinary citizens go to jail. For

the foregoing reasons, we reverse the district court’s summary judgment

granting Wellmark a blanket exemption under section 553.6(4) from

charges that it engaged in anticompetitive price-fixing or term-fixing

schemes.

      V. Whether the District Court Correctly Granted Summary
Judgment on Claims Relating to the Love v. Blue Cross Blue Shield
Settlement.

      Plaintiffs’ third amended petition alleges Wellmark conspired to

restrain trade against chiropractors by entering into an agreement with

over ninety-five percent of Iowa medical and osteopathic doctors to

“numerous items of preferential treatment, discriminatory to plaintiff, as

found in Section 7 of a Settlement Agreement dated April 27, 2007.” The

Love v. Blue Cross Blue Shield settlement resulted from a national class

action by all medical and osteopathic doctors against the state Blue

Plans, including Wellmark.          See Love, No. 03–21296–CIV (S.D. Fla.

Apr. 19, 2008). The settlement was not reviewed or approved by the Iowa
                                    33

Insurance Commissioner and thus is not subject to immunity under

section 553.6(4). The district court granted summary judgment in favor

of Wellmark, finding no genuine issue of material fact as to whether

Wellmark discriminated against chiropractors when implementing the

Love settlement. We agree with the district court’s ruling.

      The order approving the Love settlement agreement states in part:

            E. The Court has held a hearing to consider the
      fairness, reasonableness, and adequacy of the Settlement,
      has been advised of all objections to the Settlement and has
      given fair consideration to such objections.

            F. The Settlement is the product of good faith, arm’s
      length negotiations between the Representative Plaintiffs and
      the Signatory Medical Societies and their counsel, on one
      hand, and the Blue Parties and their counsel, on the other
      hand.

            G. The Settlement, as provided for in the Settlement
      Agreement, is in all respects fair, reasonable, adequate, is
      not the product of collusion between the Parties, and is
      otherwise proper and in the best interests of the Class.

Druker’s affidavit in support of Wellmark’s motion states:

            No term of the Love Settlement Agreement binds
      Wellmark not to extend to chiropractors the same or similar
      terms, or to deny chiropractors the benefit of any perceived
      advantageous changes in business practices, as are provided
      to M.D.’s and D.O.’s under that agreement.

As the district court accurately described, Druker also

      submitted a spreadsheet containing every item contained in
      Section 7 of the settlement agreement. This sets forth a
      series of procedural requirements, such as availability of fee
      schedules, reduced precertification requirements, greater
      notice of policy and procedure changes, etc. Most of the
      items are being applied to agreements with chiropractors.
      Some are not applicable.

Accordingly, Wellmark’s record evidence presents facts demonstrating

Wellmark does not provide preferential treatment to medical and

osteopathic doctors as a result of the Love settlement.
                                        34

       Plaintiffs’ resistance fails to set forth facts that show Wellmark has

implemented the Love settlement in a manner discriminatory to

chiropractors. See Green, 713 N.W.2d at 245. In response to Druker’s

affidavit,   which    was     incorporated   into   Wellmark’s     statement     of

undisputed facts, plaintiffs stated:

              Denied. This is legal argument in Exhibit 7 the class
       is defined as “any and all Physicians, Physician Groups and
       Physician Organizations . . . .” According to the Settlement
       Agreement, U 1.85, “ ‘Physician’ means an individual duly
       licensed by a state licensing board as a Medical Doctor or
       Doctor of Osteopathy and shall include both Participating
       Physicians and Non-Participating Physicians.” The State of
       Iowa recognizes that a Doctor of Chiropractic is a
       “Physician.” Iowa Code § 135.1(4) (2007): “ ‘Physician’ means
       a person licensed to practice medicine and surgery,
       osteopathic medicine and surgery, osteopathy, chiropractic,
       podiatry or optometry under the laws of this state.”
       Chiropractors were deliberately excluded from the
       Agreement, Exhibit 7.

Plaintiffs’ response merely acknowledges the Love settlement did not

include chiropractors; it does not controvert Wellmark’s record evidence.

Plaintiffs offered no affidavit testimony or other evidence to controvert

Wellmark’s evidence showing it implemented the Love settlement in a

nondiscriminatory manner.

       Accordingly, we conclude the plaintiffs failed to generate a genuine

issue of material fact precluding summary judgment on their claims

based on the Love settlement.

       VI. Other Defenses to State Antitrust Claims.

       Wellmark      raised   several   other   defenses   to    plaintiffs’   Iowa

Competition Law claims in the dispositive motions it filed below.

Generally, the district court did not reach those defenses because it

disposed of the claims on the grounds already discussed.               With three
                                      35

exceptions, we believe those defenses should be addressed further on

remand.

         First, we believe the district court properly rejected Wellmark’s

argument that the plaintiffs did not suffer an actionable “antitrust

injury.” 16   Wellmark takes the position that, because the plaintiffs are

suing as disadvantaged sellers rather than disadvantaged buyers, they

have not suffered an injury “of the type sought to be compensated by

antitrust laws.” Southard v. Visa U.S.A., Inc., 734 N.W.2d 192, 199 (Iowa

2007 (citing Associated Gen. Contractors of Cal., Inc. v. Cal. State Council

of Carpenters, 459 U.S. 519, 538, 103 S. Ct. 897, 908–09, 74 L. Ed. 2d

723, 738 (1983)). The antitrust laws are as concerned about abuse of

monopsony power to pay prices below a competitive level as they are

about abuse of monopoly power to charge prices above a competitive

level.   The seller to the monopsony has been harmed as much as the

buyer from the monopoly.       See W. Penn Allegheny Health Sys., Inc. v.

UPMC, 627 F.3d 85, 104–05 (3d Cir. 2010) (holding that a hospital had

alleged antitrust injury based on its receipt of artificially depressed

reimbursement rates from a dominant insurer and noting that “the

defendants’ argument reflects a basic misunderstanding of the antitrust

laws”); see also Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber

Co., 549 U.S. 312, 322, 127 S. Ct. 1069, 1076, 166 L. Ed. 2d 911, 920

(2007) (“The kinship between monopoly and monopsony suggests that

similar legal standards should apply to claims of monopolization and

claims of monopsonization.”).      Hence, we reject Wellmark’s “antitrust

injury” defense.


        16Wellmark reurges this argument on appeal as an alternative ground for

affirming dismissal of the antitrust claims.
                                     36

      Second, by contrast, plaintiffs’ counsel conceded at oral argument

before us that his clients cannot pursue a claim against Wellmark for

unilaterally deciding to pay chiropractors less. We agree. See W. Penn

Allegheny Health Sys., Inc., 627 F.3d at 103 (concluding that, if the

insurer had been “acting alone, [the health care provider] would have

little basis for challenging the reimbursement rates[, and a] firm that has

substantial power on the buy side of the market (i.e., monopsony power)

is generally free to bargain aggressively when negotiating the prices it will

pay for goods and services”).      Merely paying less (because one is a

monopsonist) or charging more (because one is a monopolist) does not

violate the antitrust laws. There must be some prohibited conspiracy or

exclusionary conduct as well. See Verizon Commc’ns Inc. v. Law Offices

of Curtis V. Trinko, LLP., 540 U.S. 398, 407, 124 S. Ct. 872, 879, 157

L. Ed. 2d 823, 836 (2004) (stating that “[t]he mere possession of

monopoly power, and the concomitant charging of monopoly prices, is

. . . not unlawful” and “the possession of monopoly power will not be

found unlawful unless it is accompanied by an element of an

anticompetitive conduct”). Accordingly, we affirm the summary judgment

in favor of Wellmark on any claim that Wellmark’s pricing decisions

violated section 553.5 of the Iowa Code.

      Third, Wellmark urges us to separately uphold the dismissal of

certain claims related to treatment conditions contained in the preferred

provider agreements.     Wellmark contends those claims are “waived”

because plaintiffs failed either here or below to rebut Wellmark’s evidence

demonstrating that the conditions were nondiscriminatory.             In its

summary judgment order, the district court found Wellmark’s facts were

undisputed, although it did not specifically grant summary judgment on
                                       37

that basis because it decided that all the antitrust claims were barred by

section 553.6(4).

      We agree with Wellmark that it is entitled to dismissal of these

claims.     We therefore affirm the summary judgment as to plaintiffs’

allegations that (1) Wellmark “arbitrarily imposed riders on the policies of

patients”    seeking   spinal    treatment    when    the   patient   had    prior

chiropractic care, (2) promulgated “standards and rules of practice for

‘Chiropractic Assistants,’ ” and (3) imposed a definition of “chiropractic”

to restrict covered chiropractic treatments.

      Blake’s affidavit in support of Wellmark’s motion states:

            With regard to “riders” that limit coverage when a
      member discloses preexisting joint or bone conditions,
      whether such an exclusion or policy amendment will be
      sought is determined by written underwriting guidelines.
      These guidelines make no distinction between prior
      conditions that were treated by a chiropractor as opposed to
      those that were treated by other medical professionals.

Druker’s affidavit states:
            Wellmark does not and has not ever implemented
      standards and rules of practice for “Chiropractic Assistants”
      or created a limitation that certain modes of physiotherapy
      must be applied by “Chiropractic Assistants”.
      Wellmark also showed that its definition “chiropractic” was based

on Iowa law.

      Plaintiffs’   resistance   challenged    only   the    admissibility    and

competency of Wellmark’s affidavits. Plaintiffs conceded Wellmark uses

the statutory definition of “chiropractic” in its provider forms. Plaintiffs

identified no evidence to avoid summary judgment on these claims. We

therefore affirm summary judgment here.

      Apart from the three areas we have just discussed, we conclude

that any other defenses that Wellmark may have to the Iowa Competition

Law claims would be better addressed on remand.
                                   38

      VII. Disposition.

      For the reasons stated, we affirm the district court’s ruling

granting Wellmark’s motion to dismiss plaintiffs’ statutory insurance

claims.   We reverse the summary judgment granted to Wellmark that

was based upon the state action exemption.       We affirm the district

court’s summary judgment dismissing claims that Wellmark violated

section 553.5 of the Iowa Competition Law with respect to any unilateral

payment decisions regarding chiropractors. We also affirm the district

court’s summary judgment dismissing claims based on the Love

settlement, medical spine riders, and definitions of “chiropractic

assistant” and “chiropractic.”     We remand the case for further

proceedings consistent with this opinion.

      AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
