The Federal Trade Commission announced it closed its investigation of an April acquisition by Scott & White Healthcare of a hospital in its home town of Temple, Texas. The accompanying statement for the first time acknowledges publicly that the commission's staff was prepared to sue the system to undo the deal and requested that the acquired hospital be offered to another buyer in order to resolve the matter.
FTC closes probe of Texas hospital acquisition
Scott & White's addition of King's Daughters Hospital eliminated the system's only independent competitor in Bell County, Texas, according to an explanation of the case issued by FTC Bureau of Competition Director Richard Feinstein. It was also recognized, however, that King's Daughters had been deteriorating financially and was likely to close unless it was saved by a buyer.
As reported previously without FTC confirmation, Scott & White complied with the government's request to offer Seton Family of Hospitals, a Central Texas division of Ascension Health, ownership of King's Daughters under the same terms as Scott & White secured the hospital. Seton declined the offer, saying that the hospital's condition and value had declined significantly since that time.
Feinstein observed that the outcome highlights the limitations of a remedy that attempts to turn back the clock but that the remedy was the most efficient way to find out whether there was an alternative buyer that preserved competition in the market.
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