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US settles antitrust case against Geisinger, Evangelical

The U.S. Justice Department has reached a settlement to resolve an antitrust lawsuit challenging Danville, Pa.-based Geisinger's partial acquisition of a 132-bed hospital in Lewisburg, Pa.

The Justice Department filed a lawsuit last August challenging Geisigner's plan to acquire a 30 percent ownership stake in Evangelical Community Hospital. In the lawsuit, prosecutors said Geisinger and Evangelical are close competitors for inpatient care and the deal 30 would "fundamentally" alter the relationship between the two organizations and reduce incentives to compete.

As part of the settlement, announced March 3, Geisinger must cap its ownership interest in Evangelical at 7.5 percent and can't add ownership later.

The agreement also restricts Geisinger from providing loans or another line of credit to Evangelical. Geisinger is prohibited from exerting any control over Evangelical's expenses, and both organizations must implement an antitrust compliance program.

"The anticompetitive agreement between Geisinger and Evangelical reduced their incentives to compete on the price, quality, and availability of high-quality healthcare services, which would have harmed patients in central Pennsylvania," said Richard Powers, acting assistant attorney general of the department's antitrust division. "Today’s settlement ensures that those patients will continue to benefit from robust competition between Geisinger and Evangelical."

The settlement agreement still needs court approval.

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