- Under oath, the Northshore University HealthSystem CEO said Northwestern Memorial Hospital wants the FTC to stop the pending merger with Advocate Health Care so NorthShore can join its system instead.
- The comments were made while NorthShore CEO Mark Neaman was testifying in a hearing over the FTC's request for a preliminary injunction to challenge the merger.
- On Tuesday, during the second day of the hearing, a Blue Cross Blue Shield executive said the merger would give lend leverage to raise prices.
The FTC argues the pending merger would lead to higher prices and lower quality of care. The Chicago-based systems say the FTC misidentified their market by leaving out one of their competitors: Northwestern Memorial Hospital. They also claim Chicago consumers would save $200 million to $500 million a year, the Crain's Chicago Business reported.
The proposed merger is one of the largest hospital deals FTC has challenged. They would collectively control 60% of general-acute inpatient hospital services in Chicago's north suburbs and make it the 11th largest hospital system in the country, according to federal regulators.
NorthShore's CEO Mark Neaman said Northwestern CEO Dean Harrison Harrison -- during a January 29 meeting -- told him he wanted the FTC to win the lawsuit and that Northwestern would want to merge with NorthShore.
Attorneys for the FTC and the hospital systems questioned Steve Hamman, senior vice president of provider partnerships and enterprise network solutions for the Health Care Service Corporation - the parent company of Blue Cross Blue Shield in Illinois.
"The combined entity of Advocate, NorthShore would have much greater bargaining leverage in negotiating," Hamman said.
When the FTC challenged the merger in December 2015, Director of the FTC’s Bureau of Competition Debbie Feinstein said in a prepared statement, “Advocate is one of the largest health systems in the Chicago area, and it competes directly with NorthShore in the northern suburbs of Chicago.”
“This merger is likely to significantly increase the combined system’s bargaining power with health plans, which in turn will harm consumers by bringing about higher prices and lower quality,” Feinstein said.