Georgia hospital deal scrutinized as 'monopolistic' by FTC

The Federal Trade Commission board voted unanimously Wednesday to challenge a pending deal for Albany, Ga.-based Phoebe Putney Health System to acquire Palmyra Park Hospital, also in Albany, from HCA.

The FTC alleges that the deal would reduce competition in the Albany area, and allow Phoebe Putney to raise the prices it charges to health plans for services. It also accuses Phoebe Putney of structuring the deal in a way that was meant to shield it from anti-trust scrutiny, using the "state action" doctrine.

"By eliminating vigorous competition between Phoebe and Palmyra, this merger to monopoly will cause consumers and employers in the Albany region to pay dramatically higher rates for vital health care services, and will likely reduce the quality and choice of services available in the community as well," Richard Feinstein, director of the FTC's bureau of competition, said in a statement.

In addition to issuing an administrative complaint challenging the deal, the FTC also voted to join the Georgia Attorney General's office in a complaint filed in U.S. District Court to halt the deal until the agency can hold an administrative proceeding.

Phoebe Putney CEO Joel Wernick expressed disappointment in the decision. "The FTC's attempt to block this transaction is disheartening because we remain confident, especially with the increasing demand for collaboration in healthcare delivery, this transaction will benefit the health of the citizens in our community," he said.

To learn more:
- read the AHA News Now brief
- here's the FTC's statement