Illinois hospitals sued over plan to create 4-hospital system

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An outpatient surgery center in Illinois is suing to block Carbondale, Ill.-based Southern Illinois Hospital Services from acquiring Harrisburg (Ill.) Medical Center. 

In June, Southern Illinois Hospital Services announced its intent to buy Harrisburg Medical Center. If the two organizations close the deal, it would create a four-hospital system serving a 16-county region. Harrisburg Medical Center would join Southern Illinois Healthcare's three hospitals: Memorial Hospital of Carbondale, Herrin (Ill.) Hospital, and St. Joseph Memorial Hospital in Murphysboro, Ill. 

Marion (Ill.) HealthCare, a multispecialty surgery center, is suing to prevent the deal, arguing the combination of the two health systems "would substantially reduce competition in an already highly concentrated market, would harm the public and would cause antitrust injury" to the surgery center. 

In the lawsuit filed July 29 in federal court in Illinois, Marion HealthCare argues that Southern Illinois Hospital Services is the dominant competitor and a "monopolist" for acute general hospital services in Southern Illinois, and it is looking to acquire one of the two remaining non-Southern Illinois Hospital Services-owned hospitals in the market. Under the deal Harrisburg's outpatient clinics and physician practices would join the Southern Illinois Hospital Services network. 

"The acquisition would enable SIH to maintain and extend its monopoly power in the market for ambulatory surgery services," the lawsuit contends. 

Marion HealthCare said the merger could disrupt referral patterns, staff retention and patient costs in the region, which could result in lower income for the facility.

Marion HealthCare is asking the court to permanently block the merger, correct any anticompetitive effects of the acquisition and bar any future merger between the two organizations.

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