The state of North Carolina has given its nod to the merger of the only two private acute-care hospitals in Asheville, but the hospitals have yet to agree to state-imposed terms.
Under the full-asset merger, Mission Hospital and St. Joseph's Hospital would control 91% of admissions from Madison County, which has no acute-care hospital, and 87% of admissions from Buncombe County, which includes Asheville.
Last month, the state's Department of Health and Human Services issued an amended certificate of public advantage to Asheville's Mission St. Joseph's Health System, the joint operating company formed in 1995 by Memorial Mission Medical Center, now called Mission Hospital, and St. Joseph's.
A 1993 state law extends antitrust immunity to healthcare providers that can prove the consumer benefits of their transaction outweigh any anti-competitive risks. If the state grants such an exemption, regulators will issue a COPA outlining safeguards against anti-competitive behavior.
The amended COPA issued Sept. 30 requires the hospitals to cap increases in charges for healthcare services and negotiate "in good faith" with all health plans in their service area.
Health department officials said in the COPA that they approved a full-assets merger because it would provide an additional $2 million in savings over a five-year period-an increase of 2.7% over the promised $74.2 million in savings generated from the joint operating agreement.
If they fail to reach that mark, the hospitals must pay the difference into a state-administered fund for free or subsidized-care in the Asheville area. The state estimates the hospitals have already realized $20 million in operational savings.
Despite the go-ahead from state regulators, the hospitals have not signed the COPA, leaving the merger incomplete.
Mission St. Joseph's wants the state to make some adjustments, including allowing more than 15% of the merged organization's board members to be physicians with staff privileges or membership.
A spokesman for Mission St. Joseph's said the hospitals had not signed the COPA as of Oct. 15.