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US: FTC options limited in Phoebe Putney healthcare merger settlement

By  |  August 23, 2013

The US Federal Trade Commission announced an agreement has been reached with a hospital authority in Georgia and Phoebe Putney Health System regarding the healthcare group’s buyout of a hospital. According to the regulator, while a settlement has been reached between the parties that includes the two must notify the FTC of any future transactions and prevents the exclusion of potential entrants into the local market.

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    The watchdog is limited, however, in its options. While the regulator would have preferred to require hospital divestures of the health system company, the state has “unique” Certificate of Need laws that prevent any forced sales. The FTC therefore could not require the hospitals to become independent competition in the market.

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    The FTC opened its case against the parties following Phoebe Putney’s acquisition of the Palmyra Park Hospital; a review of the deal found threats to competition in six counties in the state. Despite the limitations, a statement by the FTC’s Director of the Bureau of Competition Deborah Feinstein described the settlement as a victory following the US Supreme Court’s ruling that the hospital buy could be reviewed by federal authorities, limiting the scope of state-level antitrust immunity. “Regrettably,” said Feinstein, “that legal victory will not undo the acquisition’s clear harm to competition.”

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