For-profit hospital chains and antitrust agencies have a rich tradition in the state of Tennessee that dates back more than a decade.
With the merger between Columbia/HCA Healthcare Corp. and Healthtrust, that tradition may enter a new chapter given the chains' control of so many hospitals there.
In total, the combined companies would own 26 hospitals in Tennessee, or about 16%, of the 167 acute-care hospitals in the state.
Most of Healthtrust's 13 hospitals in Tennessee are sole community providers in rural counties or have few if any competitors in their markets. Most of Columbia/HCA's 13 hospitals, meanwhile, are clustered around metropolitan areas, such as Nashville and Chattanooga.
Unless the federal antitrust agency charged with reviewing the mega-merger expands the relevant geographic markets in Tennessee to regional rather than local borders, the companies likely won't have antitrust problems in most areas of the state.
But one trouble spot may be in and around Nashville, where Columbia/HCA operates three acute-care hospitals and where Healthtrust just entered the market earlier this year with its acquisition of 314-bed Nashville Memorial Hospital in adjacent Madison, Tenn.
Columbia/HCA also operates two inpatient psychiatric hospitals in Nashville.
A merger would give the two companies control of four of the market's 10 acute-care hospitals, representing about 36% of the staffed inpatient beds there, according to the latest figures from the American Hospital Association.
Adding to the chains' market penetration is 59-bed Hendersonville (Tenn.) Hospital, a Healthtrust facility.
Hendersonville is located about 18 miles northeast of Nashville. Hendersonville Hospital is the only acute-care facility in town but has two other hospital competitors in Sumner County, Tenn., according to the AHA.
Another traditional trouble spot may be Chattanooga, where February's merger between Columbia and Hospital Corporation of America gave the newly merged companies control of two of the market's five acute-care hospitals.
Although the Federal Trade Commission cleared the Columbia-HCA deal, one dissenting FTC commissioner said the agency should have forced the two companies to divest one of the two Chattanooga hospitals (Feb. 14, p. 2).
In a similar case in 1985, the FTC ordered HCA to divest two hospitals in Chattanooga and drop its management contract of a third after the company gained control of five of the city's 11 hospitals.
The Columbia/HCA-Healthtrust deal would add one hospital to the chains' Chattanooga market, 50-bed South Pittsburg (Tenn.) Hospital.
South Pittsburg is located about 18 miles west of Chattanooga, and the city's lone hospital also is the only hospital in Marion County, Tenn., according to the AHA.