FTC chair expresses concern about continued hospital mergers

The chairwoman of the U.S. Federal Trade Commission expressed concern last week that continued hospital consolidation would have a sustained impact on both pricing and care, The Washington Post reported

Edith Ramirez, chair of the FTC, said in a speech that "competition plays an important role with respect to quality as hospitals compete to attract patients," and that she was "very concerned about the rapid rate of consolidation among healthcare providers."

Hospital merger activity has been strong in recent years, with many parties saying the business realities of the Affordable Care Act are driving them to seek partners.

However, the FTC has been particularly aggressive in recent months to try and curb hospital mergers in regions of the country where the agency believes there would be a deleterious effect on competition. Last November, the agency intervened to block the merger of two hospitals in rural West Virginia. In December, it intervened to stop a merger between two major hospital operators in Chicago, Advocate Health Care and NorthShore University HealthSystem, which together operate 16 acute care facilities throughout the region.

However, the FTC recently lost its challenge to a merger involving two hospitals in central Pennsylvania. In that case, a federal judge ruled just last week that the merger between Penn State Milton Hershey Medical Center and PinnacleHealth System could proceed. The FTC had claimed in its legal action that the deal to create the Penn State Health system would give it more than 60 percent of the hospital market in four Pennsylvania counties.

"We are disappointed that the chairwoman doesn't recognize the irony in this case clearly evident to the court: building a modern healthcare system compels the kind of affiliations the commission continues to challenge," Rick Pollack, president of the American Hospital Association, told The Washington Post.

To learn more:
- read The Washington Post article

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