According to Hackensack Meridian Health and Englewood Health, they appealed to postpone the proposed merger. Court documents filed last week.
New Jersey Health System announced Their intention to merge 2019. Hackensack Meridian Health has committed to make a capital investment of US$400 million in Englewood Health after the merger obtains regulatory approval. But antitrust agencies are delaying transactions.
Last December, Federal Trade Commission sued Prevent the merger. The FTC stated in the complaint that the United Medical System will control three of the six inpatient general acute care hospitals in Bergen County, New Jersey.
The agency said, therefore, the proposed transaction will curb competition and push up prices in the region.
Ian Conner, Director of the Competition Bureau of the US Federal Trade Commission, said: “This acquisition will increase the bargaining leverage of the combined hospital system, which may lead to price increases.” In the press release“The transaction will also eliminate the competitive pressure that drives these hospitals to invest in improving quality for the benefit of patients.”
The U.S. District Judge approved the FTC’s preliminary injunction motion on August 4.
In the appeal, the health system claimed that although the district court determined that the merger would result in improvements in quality, facilities and services, it still delayed the merger.
In its appeal, the health system stated that the FTC’s case depends on “hospitals’ ability to discriminate prices against patients living in Bergen County, New Jersey. This is something that hospitals admitted in negotiating with health insurance companies that they did not and cannot do” .
In addition, the district court stated that the Federal Trade Commission has provided “direct evidence” that the merger may lead to anti-competitive price increases, but the evidence is based on a study of patients’ willingness to pay after mergers in other states, not on the health system’s claim. The insurance company agreed to pay, “This shows that the price cannot rise.”
There are conflicting studies about whether the merger of health care actually raises prices.Analysis performed 2018 New York Times Showed that the merger increased hospitalization costs in most cases, and one study Commissioned by the American Hospital Association In 2019, it was found that the merger reduced costs.
Although the evidence is not clear, Hackensack Meridian Health and Englewood Health are confident of its appeal.
“After reviewing the district court’s decision, the leadership and board of Hackensack Meridian Health and Englewood Health firmly believe that there are grounds for an appeal and therefore have filed an appeal,” these organizations said in an email statement to MedCity News.
The Federal Trade Commission said it would appeal in a few weeks Adjust the merger review procedure Because this year has been overwhelmed by a large number of applications. The agency described it as “a wave of merger applications” and stated that it has begun writing to remind the company that the FTC’s investigation into its merger is still ongoing, and reminded them that the agency may subsequently determine that their transaction is illegal .
The agency said: “Companies that choose to conduct transactions that have not been fully investigated will bear their own risks.”
Photo: Andre Popov, Getty Images
