The Federal Trade Commission said Monday it is dropping its lawsuit to block John Muir Health’s proposed acquisition of San Ramon Regional Medical Center, following the health system's decision to scrap the deal.
Walnut Creek, California-based John Muir, a two-hospital nonprofit system, signed a definitive agreement in January to acquire San Ramon Regional from Dallas-based Tenet Healthcare in a $143 million deal. For-profit Tenet, a 61-hospital system, holds a 51% stake in San Ramon Regional. John Muir, which holds a 49% non-operating stake, planned to acquire Tenet's interest.
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In the lawsuit filed Nov. 17, the FTC and the California Attorney General’s Office alleged the proposed deal would lead to price increases on services and more out-of-pocket costs for patients. They sought a temporary restraining order and preliminary injunction in the U.S. District Court for the Northern District of California.
After the suit was filed, John Muir said it was disappointed by the agency's action and would consider challenging it in court. John Muir also argued the San Ramon acquisition would drive improvements in technology, care quality and facilities.
In a statement from John Muir Monday, the health systems said they decided not to pursue litigation against the FTC's legal challenge because of the time and cost that would be involved.
