St. Luke's appeals judge's ruling to unwind physician acquisition

St. Luke's Health System in Idaho filed an appeal last week to reverse U.S. District Judge B. Lynn Winmill's decision to dissolve its acquisition of the state's largest independent physician practice, Saltzer Medical Group, according to court documents filed in the U.S. Court of Appeals for the Ninth Circuit.

In the appeal, St. Luke's argues the court applied the incorrect definition of "merger-specific" in its original ruling, and imposed on the hospital and other defendants the burden of proving the absence of any less restrictive alternatives, rather than requiring plaintiffs, including St. Alphonsus Health System of Boise, to prove both the existence and effectiveness of those alternatives.

In January, Winmill ruled that St. Luke's Health System violated antitrust laws when it purchased Saltzer, with plaintiffs arguing the acquisition gave St. Luke's an unfair advantage by dominating primary medical care in Canyon County.

Although the judge agreed St. Luke's intended to improve care, and the acquisition would help improve healthcare delivery, there were ways to achieve those goals that didn't violate antitrust laws and run the risk of driving up healthcare costs, FierceHealthcare previously reported.

St. Luke's President and CEO David C. Pate, M.D. hopes the appeal will allow the system to improve patient outcomes through strong physician partnerships.

"It is our hope that the appeals court will permit our affiliation with Saltzer to move forward so we can continue the good work we started. We believe the district court erred in its conclusion that St. Luke's acquisition of Saltzer Medical Group would have anticompetitive effects, and disregarded the substantial procompetitive benefits the court believed would have resulted if the acquisition were to stand," Pate wrote in a blog post on the hospital's website.

The Federal Trade Commission's intervention sends a mixed message, as mergers and acquisitions between hospitals and doctors grow, and government regulators have generally encouraged such deals as they tend to create cost efficiencies, FierceHealthFinance previously reported.

To learn more:
- here's the appeal
- read the blog post