Ohio System Says FTC Challenge of Merger 'Inconsistent' With Call for Integration

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Toledo-based ProMedica Health System said the Federal Trade Commission's new antitrust challenge of its acquisition of a 198-bed hospital is "inconsistent with the integration and coordination that healthcare reform both encourages and requires," according to a statement from ProMedica.

Yesterday, after months of investigations, the FTC formally challenged ProMedica's acquisition of St. Luke’s Hospital in Maumee, Ohio, claiming it reduced competition and would contribute to higher prices.

An FTC official disagreed with ProMedica's claim that the challenge would harm integration. "Healthcare reform and the trend to clinical integration is not a blank check to acquire your competitor or eliminate competition," Jeffrey H. Perry, deputy assistant director of the FTC bureau of competition, told the Toledo Blade.

In a release, the FTC said it plans to ask for a temporary restraining order and preliminary injunction against ProMedica, which would freeze jobs and services at current levels at St. Luke's until the case is decided. ProMedica has been ordered to appear before an FTC administrative law judge for a May 31 trial in Washington, D.C.

"Business documents reveal that a principal motivation for the acquisition was for St. Luke's to gain enhanced bargaining leverage with health plans, and the ability to raise prices for services," the FTC stated.

In its statement, ProMedica said it was performing a community service. St. Luke's was in "financial distress" and the acquisition would keep the hospital open to provide services, the system said. However, outgoing Ohio Attorney General Richard Cordray told the Toledo Blade that his office and the FTC have records showing St. Luke's was a financially strong and viable competitor.

ProMedica announced the acquisition in May and finalized it on Aug. 31, but the FTC put the deal is under a "hold-separate" in October, meaning that the hospital and health system had to delay integration.

Read the FTC release on ProMedica.

Read the ProMedica statement on the FTC action.

Read the Toledo Blade report on the FTC action.

Read more coverage of the St. Luke's acquisition and the FTC's efforts to get information about it:

- FTC Files Request in Ohio District Court for Information on St. Luke's, ProMedica Merger

- District Court Judge Won't Grant FTC Request for Information on St. Luke's, ProMedica Merger

- Ohio's St. Luke's Hospital to Join ProMedica Health System

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