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FTC seeks emergency halt to Philadelphia hospital merger

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The Federal Trade Commission is seeking to stop Philadelphia-based Jefferson Health and Einstein Healthcare Network from completing their merger while the agency appeals a federal judge's decision to allow the transaction to move forward. 

The FTC and the Pennsylvania attorney general's office sued in February to block the deal. They argued the combination of the two systems, which comprise 17 hospitals, would reduce competition in Philadelphia and Montgomery counties and lead to price increases. 

Judge Gerald Pappert of the U.S. District Court for the Eastern District of Pennsylvania rejected that argument and held Dec. 8 that the government did not meet its burden. The FTC's case relied on testimony from health insurers, which the court said was "not credible" and "undercut by other evidence," the judge wrote in the 62-page decision. 

The FTC on Dec. 9 filed a motion for an emergency injunction pending appeal, arguing the health systems will not be injured by temporarily delaying the transaction during the appeals process because the merger agreement does not expire until the later of Dec. 31, 2021, or 60 days after a final decision by a U.S. Court of Appeals. 

The health systems said they intend to see the deal through. 

"It is unfortunate that at a time when Jefferson and Einstein are providing care to large concentrations of COVID-19 patients and underserved populations that we are being forced to spend tens of millions of dollars to defend our merger," Stephen Klasko, MD, CEO of Jefferson Health, and Barry Freedman, president CEO of Einstein, said in a joint statement to the Philadelphia Inquirer

The judge ordered the health systems to file a response to the FTC's motion by 12 p.m. EST on Dec. 11. 

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