North Carolina’s treasurer filed a brief in support of the Federal Trade Commission’s pending efforts to block Novant Health from acquiring two hospitals in the state.
Dale Folwell (R), a longtime critic of consolidation in the healthcare industry, argued in the Monday brief that Novant’s $320 million proposed acquisition of two Community Health Systems hospitals in the Charlotte region would raise costs and hurt taxpayers.
Related: Community Health Systems to exit North Carolina
"When hospitals eliminate competition and achieve market dominance, they have undue leverage over insurers, other healthcare payers, and ultimately patients," the "friend of the court" brief filed in the U.S. District Court for the Western District of North Carolina said. "Taxpayers and state employees are forced to subsidize the resulting monopolist’s profits."
The acquisition will allegedly pass on costs to the nearly 750,000 members on the state’s employee health plan through higher premiums and other fees, said Folwell, who acts as a fiduciary for the plan.
The FTC sued Novant in January to block its acquisition of Lake Norman Regional Medical Center in Mooresville and Davis Regional Medical Center in Statesville, alleging the deal would be anticompetitive and irreversibly consolidate the market. Last month, the FTC filed to seek a preliminary injunction to block the acquisition.
Novant, based in Winston-Salem, North Carolina, said in a statement this week it believes the acquisition will improve quality of care and long-term patient outcomes.
"The FTC’s 'one-size-fits-all' attack on hospital mergers, echoed by the amicus brief, misses the real-world facts about this transaction," Novant said. "Our commitment to purchase is, fundamentally, a commitment to restore services lost over time and to provide new, leading-edge technology that will enhance the clinial capabilities available to the greater Charlotte community."
Franklin, Tennessee-based Community Health Systems, which plans to sell more than $1 billion of facilities in the next few years to improve its financial standing, declined to comment on Folwell's brief.
