Bruce Sokler—an attorney who is the manager of the antitrust practice at Mintz, Levin, Cohn, Ferris, Glovsky and Popeo in Washington—said the decision in Rockford to forgo the affiliation was not surprising, given that the FTC and its administrative law judge have already rejected many of the same types of arguments in the ProMedica case, which is headed for an appeal in the 6th U.S. Circuit Court of Appeals.
“Having seen how ProMedica has gone with the FTC, the Rockford parties had to assume that their arguments would not be embraced by the FTC, and they would have a long, expensive slog to the court of appeals before they could get the result they want,” Sokler said.
The CEOs at OSF St. Anthony Medical Center and Rockford Health System declined to be interviewed for this story. In a joint written statement, hospitals officials said they remained convinced the deal would have promoted competition and been consistent with the goals of healthcare reform, but they decided to dedicate money that would have gone to legal fees to providing healthcare instead.
FTC Competition Bureau Director Richard Feinstein said in a statement that consumers and employers who purchase health insurance benefitted from the decision to abandon a merger that he maintained would have given the providers greater leverage to raise prices.
Several attorneys said the FTC's challenges in Illinois and Ohio, along with a third pending challenge to a hospital acquisition in Albany, Ga., paint a pattern of the kinds of mergers that will encounter scrutiny. Specifically vulnerable are those that consolidate competing hospitals in smaller and more-isolated healthcare markets.
Art Lerner, a partner in healthcare law at Crowell Moring in Washington, noted the significance of the district courts in the Illinois and Ohio cases granting preliminary injunctions to hold the merging entities separate during the lengthy litigation.
“These two cases are pretty noteworthy in that regard,” Lerner said. “Frankly, though, I think it would have been more noteworthy if the commission had not brought this (Rockford) case, or if the commission had lost this case.”