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LCMC sues FTC after it challenges acquisition of 3 HCA hospitals

New Orleans-based LCMC Health has filed a lawsuit against the Federal Trade Commission, the Department of Justice and U.S. Attorney General Merrick Garland, seeking clarification on whether a state's acquisition approval can preempt federal merger review, according to nola.com.

The lawsuit relates to LCMC's acquisition of three Louisiana hospitals from Nashville, Tenn.-based HCA Healthcare. LCMC purchased the hospitals for $150 million in January. 

The FTC had ordered LCMC to halt the acquisition while it conducted a review, but the Louisiana legislature and state attorney general had "expressly and unequivocally authorized" the deal to go through, according to court documents obtained by Becker's.

Louisiana is one of about 20 states that gives the state the authority to greenlight hospital mergers under the certificate of public advantage process, according to nola.com. 

Because of this, LCMC argues in court documents that the acquisition is "indisputably immune" from federal antitrust laws, including the HSR Antitrust Act, which it said is consistent with Supreme Court precedent affirming the state-action antitrust immunity.

In March, however, the FTC told LCMC that the acquisition should have cleared a federal review for potential antitrust violations, and ordered the system to file for the review and pay penalties that could rise to more than $5 million, according to court documents. 

"The certificate of public advantage process was rigorous and transparent, with active supervision to ensure consumer protection," LCMC said in a statement provided to Becker's. "We are on solid ground and Louisiana knows what is best for our community. We are steadfast in our commitment to delivering health, care and education beyond extraordinary for all, and continuing to deliver the benefits of the partnership for our patients and community."

The hospitals involved in the acquisition are New Orleans-based Tulane Medical Center; Covington, La.-based Lakeview Regional Medical Center; and Metairie, La.-based Tulane Lakeside Hospital.

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