The U.S. Department of Justice has filed an antitrust lawsuit against the NewYork-Presbyterian Hospital system, accusing it of leveraging its dominant position in New York City to push insurers into accepting significantly higher prices and limiting access to more affordable health coverage.

According to the complaint, filed in Manhattan federal court, the hospital system allegedly entered into “unlawful contracts” with insurance companies that restrict patients from being offered lower-cost insurance plans.

“Americans deserve the benefits of vigorous competition,” the lawsuit states, arguing that the hospital system’s “anticompetitive conduct” has left families with fewer choices and higher costs.

Federal prosecutors are seeking to halt these practices and reestablish “access to budget-conscious health insurance plans.”

The filing notes that NewYork-Presbyterian controls roughly 30% of the hospital market in Manhattan and operates more than 4,000 inpatient beds across eight campuses throughout the city.

Because of its size and reach, the lawsuit argues that insurers “cannot viably do business in New York City” without including at least some of the system’s facilities in their networks.

However, instead of allowing insurers to selectively include certain hospitals, NewYork-Presbyterian is accused of insisting on “all-or-nothing” agreements. Under these arrangements, insurers must include every facility in the system — including the most expensive ones — if they want any access at all, the lawsuit claims.

This approach comes despite allegations that the system’s prices are higher than those charged by competitors such as NYU, Mount Sinai, and Northwell.

The DOJ argues that these restrictions shield the hospital system from “price competition,” leading to “reduced choice of insurance plans, higher healthcare costs and less competition for high-quality healthcare for employers and patients who purchase healthcare in New York City,” the suit claims.

“Rather than offer consumers choice, New York-Presbyterian uses its market power to protect its margins, impede competition from rival hospitals, and prevent employers and unions from creating these plans,” said Omeed A. Assefi, acting assistant attorney general from the DOJ’s anti-trust office.

The lawsuit also includes a specific example in which NewYork-Presbyterian allegedly intervened to block an insurer from shifting outpatient colonoscopy procedures to a less expensive provider.

“NYP observed that even stopping a single payor from moving outpatient colonoscopies out of NYP’s hospitals was ‘worth ~250k [dollars] to [a physician group in NYP’s system] and multiples more to [NYP],’” the suit claims.

In addition, the filing references a “recent strategic planning document” in which the hospital system allegedly expressed concern that offering patients lower-cost alternatives could create “pricing pressure” and negatively “impact [NYP’s] margins.”

In response, NewYork-Presbyterian said it was “disappointed” by the lawsuit and rejected the allegations, stating that the claims are “without merit” and noting that discussions with the DOJ had already been underway.

“We do not seek to exclude any other hospital from any insurer’s network,” said hospital spokesperson Angela Karafazli. “Nor do we require more favorable treatment than any other hospital.”

“The obligation of insurance companies is to their shareholders, while ours is to our patients,” she said. “We believe all New Yorkers should be able to choose their health care provider.”