- In a blow to antitrust regulators, an Illinois federal judge refused to block the merger of NorthShore University Health System and Advocate Health Care, Crain’s Chicago Business reported.
- In a Tuesday decision, Judge Jorge Alonso of the U.S. District Court for the Northern District of Illinois said the Federal Trade Commission had failed to convincingly demonstrate its antitrust claims against the two health systems would prevail.
- Lawyers for Advocate and NorthShore had argued the FTC’s assessment of the proposed merger left out a large competitor, Northwestern Memorial Healthcare, and ignored benefits of the deal.
“Judge Alonso’s decision reaffirmed what we have wholeheartedly believes since day one: This merger is a big win for consumers and for healthcare in our country as the shift to value takes hold,” Advocate CEO Jim Skogsbergh said in a statement. “We look forward to rolling up our sleeves and getting to work together to deliver on our commitment of making healthcare more affordable while raising the standard of care.”
Alonso’s refusal to grant a preliminary injunction is the second loss for the FTC in the past month. In May, a Pennsylvania federal judge denied a request for a preliminary injunction to scuttle the merger of Penn State Hershey Medical Center and PinnacleHealth System.
The FTC said it was considering its options.
Downers Grove-based Advocate is the state’s largest health system with 12 hospitals, while Evanston-based NorthShore has four.
The systems say the six-county market they serve has about 75 hospitals. But the FTC says the cost savings and quality improvements the systems are predicting have not been substantiated and are not merger-specific.
Some say the decision is good for future mergers. “Decisions like this are going to give others looking at mergers some hope that you're not necessarily dead in the water, that arguments around market efficiencies and population health management could really carry some weight,” Roger Strode, a partner at Foley & Lardner, was quoted in Modern Healthcare.
While the hospitals posit the merger would contain costs, it should be noted a recent study in California found two of the states biggest hosptial chains used their market power to raise prices 20% more compared with other state hospitals.