Anti-trust agencies target hospitals to promote competition

Aiming to preserve competition among healthcare providers and protect patients, the Federal Trade Commission challenged 17 of the 1,450 merger transactions reported in fiscal year 2011, with two involving hospitals. The healthcare targets were ProMedica and St. Luke's Hospital in Ohio and Phoebe Putney Health System and HCA-owned Palmyra Park Hospital in Albany, Ga., according to an annual report from the FTC and the U.S. Justice Department's Antitrust Division.

"These challenges … are part of the Commission's broader effort to promote competition in the healthcare sector, which benefits U.S. consumers with products and services that are lower cost and high quality," the report states.

The FTC scored a win last year when an administrative judge ruled that a partnership between ProMedica and St. Luke's Hospital was anticompetitive. This past March, the FTC said the health system must give up St. Luke's Hospital within six months. ProMedica plans to appeal to a federal court.

That anti-trust challenge follows the ongoing battle between the commission and Phoebe Putney and Palmyra Medical Center. Although a district court judge last year ruled in favor of the deal to move forward, the FTC recently called on the U.S. Supreme Court to review the hospital merger.

Worried that some mergers would stifle competition and hike up prices, the commission filed a complaint last year to halt an acquisition deal between Illinois health systems, OSF HealthCare and Rockford Health System. In April, the systems decided to call off the merger instead of enduring a lengthy and costly legal battle with the FTC.

However, the commission allowed Sanford Health in Fargo N.D., and Sioux Falls, S.D., to affiliate with North Dakota's Medcenter One health system, both organizations announced last month. The health systems noted that regulatory filings with the FTC and the North Dakota Attorney General's Office are going forward.

To learn more:
- read the FTC report (.pdf)
- here's the Medcenter statement (.pdf)